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N. NAGARESH
Sreevidhya S. , W/o Sasidharan (Late) – Appellant
Versus
Trivandrum Co-Operative Agricultural & Rural Development Bank Ltd – Respondent
JUDGMENT :
The petitioner is a widow living with three daughters. While working in United Arab Emirates, her husband Sasidharan passed away in the year 2019. In 2016, the petitioner was given five loans for a total amount of Rs.10 lakhs by the 1st respondent-Trivandrum Co-operative Agricultural and Rural Development Bank. Consequent to the death of the petitioner's husband, repayment fell into arrears.
2. The 1st respondent issued Ext.P2 demand notice dated 07.01.2022 requiring the petitioner to pay Rs.6,20,000/-. The petitioner could not pay the amount. The 3rd respondent thereupon issued a notice of proclamation of sale as per Ext.P3. The petitioner contends that the notice was not as required by Section 19 of the Kerala State Co-operative (Agricultural and Rural Development Banks) Act, 1984 (hereinafter referred to as 'the Act, 1984'). The petitioner challenges Exts.P2 and P3 on various grounds.
3. The petitioner states that the Board or the Committee of the Bank has not authorised the sale of property as required under Section 19(2)(a) of the Act, 1984. No registered notice demanding the amount due was sent to the petitioner as required under Section 19(2)(b) read with Section 19(
The main legal point established is that compliance with the provisions of the Kerala State Co-operative (Agricultural and Rural Development Banks) Act, 1984 and the Rules is essential for valid fore....
Sale of property under mortgage invalid when prior encumbrances are ignored, highlighting the need for equitable operations in financial transactions.
A sale officer may proceed to sell a defaulter's properties other than mortgaged property in applying for debt recovery if suitable under the cooperative society's regulations.
The validity of the sale/e-auction notice under the SARFAESI Act and the Security Interest (Enforcement) Rules, 2002.
Sale at reserve price under SARFAESI Rules requires borrower consent; reserve price notice discrepancies vitiate auction process.
Court upheld the validity of bank's actions under cooperative law, ruling that delayed challenges based on fraud were insufficient; commercial agreements should be honored.
The court established that compliance with procedural rules in auction sales is essential, and the burden of proof lies with those challenging the sale to demonstrate fraud or irregularity.
The power of attorney authorized the attorney to mortgage the property, creating a binding mortgage valid against the family's claims, even if the borrowing parties did not own the property.
The court emphasized that auction sales must adhere to statutory requirements and principles of natural justice, ruling that collusion invalidates the auction process.
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