The main legal point established in the judgment is the interpretation and application of the SARFAESI Act provisions, particularly Sec. 13(2), Sec. 13(3A), and Sec. 13(4), in the context of loan restructuring and recovery proceedings.

R. SUBBIAH, J.

1. The petitioner is a Private Limited Company duly incorporated under the Companies Act 1956 and represented by its Director, namely, N.Rajan Venkatesh.

2. The petitioner Company is carrying on the business of Horticulture and Floriculture. In order to develop its business, the petitioner Company approached the 2nd respondent Bank requesting them to provide credit facilities. The 2nd respondent Bank, by letter dated 05.01.2008, sanctioned a sum of Rs.170 lakhs towards Agricultural Term Loan, for which, agricultural land to the extent of 9.29 acres belonging to the Directors of the Petitioner Company were offered as collateral security. The petitioner, by utilizing the credit facilities, completed the entire green house structure and started plantations of carnation cut flowers at their Thandikudi Farm. The respondent bank further sanctioned a sum of Rs.50 lakhs on 19.08.2011 towards agricultural term loan. But, the petitioner availed only a sum of Rs.37.15 lakhs.

3. According to the petitioner, due to crisis in the field of floriculture industry, the company was unable to repay the loan amount, however, the company has been paying the interest amount to the Bank. Hence, the petitioner requested the Bank to restructure their loan amount. However, the 2nd respondent without considering the request of the petitioner company for restructuring the loan amount, wrongly classified the loan account of the petitioner company as Non- Performing Asset on 31.03.2018 and initiated recovery proceedings under Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (in short SARFAESI Act)

4. The first respondent issued demand notice dated 18.07.2018 under Section 13(2) of the SARFAESI Act, demanding a sum of Rs.1,76,67,840.91. According to the petitioner, the said demand notice does not contain the particulars and details as required under SARFAESI Act and hence, it is per se illegal.

5. It is the case of the petitioner that the Company gave a proposal for one time settlement by letter dated 23.08.2018 along with a cheque for a sum of Rs.5 lakhs as up-front amount, but the same was rejected by the respondent Bank by letter dated 31.08.2018 and the above cheque was returned. As the said demand notice is not in accordance with SARFAESI Act and Security Interest Rules, the petitioner raised its objections by their representation dated 06.09.2018 as per Section 13(3A) of the Act, for which, the respondent gave evasive reply. Thereafter, the respondent, on 31.10.2018 issued possession notice under Section 13(4) of the SARFAESI Act, against the petitioner Company and the Directors of the Company and took possession of the properties mortgaged with the bank on 31.10.2018. Aggrieved over the same, the petitioner Company filed an appeal before the Debts Recovery Tribunal, Madurai, in S.A.No.613 of 2018. The Tribunal, by an order dated 17.12.2018 granted an order of interim stay, subject to payment of Rs.12,57,000/- each on three instalments, namely, on 18.01.2019, 18.02.2019 and 19.03.2019, failing which, stay granted shall stand automatically vacated and directed to post the case on 23.02.2019. Aggrieved against the said order, the present writ petition has been filed.

6. The learned counsel for the petitioner submitted that the respondent Bank issued demand and possession notice on a dead person, namely, Mr.P.Manohar, who is one of the Directors of the Company. Once the person, who is the borrower or guarantor of the loan, died, the demand and possession notice should be issued on the legal heirs of the deceased person. But, the respondent Bank did not do so. When the notice was issued on the dead person and the same was challenged before the Debts Recovery Tribunal mainly on the ground that the demand and possession notice issued against a dead person, namely, Mr.P.Manohar, who is one of the Directors of the Company, is unsustainable, the interim order passed by the Debts Recovery Tribun