The Banker's Right of General Lien under Section 171 of the Indian Contract Act, 1872, and the statutory recognition of Reserve Bank of India's directives on income recognition and asset classification were central to the court's decision.

JUDGMENT

(Prayer: Writ Petition filed under Article 226 of the Constitution of India, 1950, praying to issue a Writ of Certiorarified Mandamus, calling for the records of the Third Respondent in Letter No. LVB/898/REC/GEN/02/2019-20 dated 12.06.2019 quash the same and consequently direct the Respondents to release the jewels to the Petitioner after receipt of mortgage amount with interest with respect to the JDL Account Nos. A. No. 0665773000035883 and A. No. 0665773000040977.)

Heard Mr. Gowthaman Sankaran, Learned Counsel appearing for the Petitioner and Mr. A. Arunbabu, Learned Counsel appearing for the Respondents and perused the materials placed on record, apart from the pleadings of the parties.

2. The Petitioner had availed various credit facilities from the Third Respondent and the details of the same have been set out in the following self-explanatory tabular statement:-

Since the Petitioner committed default in repayment of the aforesaid Business Loan, it had been classified as Non-Performing Asset (hereinafter referred to as 'NPA' for short) on 28.02.2019 and the Second Respondent as Authorised Officer had issued a Demand Notice dated 26.04.2019 under Section 13(2) of the Securitization and Reconstruction of Financial Asset and Enforcement of Security Interest Act, 2002 (hereinafter referred to as 'the SARFAESI Act' for short) to the Petitioner for the same. At that stage, the Petitioner by letter dated 06.06.2019 complained to the First and Second Respondents that the Third Respondent was not permitting him to redeem the jewels that had been pledged as security for the aforesaid Jewel Loans – I & II despite his willingness to discharge that liability by paying interest, and was insisting on clearing that Business Loan also which he could not repay immediately on account of drought and business losses. The Second and Third Respondents sent reply notices dated 12.06.2019 to the Petitioner informing that the jewels pledged for the aforesaid Jewel Loans – I & II cannot be released until the closure of that Business Loan since the jewels are having indirect liability to the Business Loan facility. Aggrieved thereby, the Petitioner has filed this Writ Petition challenging the said reply notice dated 12.06.2019 and for consequential direction to the Respondents to release the jewels to the Petitioner after receipt of the amount due with interest in respect the aforesaid Jewel Loans – I & II.

3. When the matter came up for hearing on 05.09.2019, Learned Counsel for the Petitioner sought for interim injunction of auction of the pledged jewels in respect of Jewel Loan – I that had been fixed on 07.09.2019. In response to the specific query then raised by this Court as to whether the petitioner is willing to remit the dues under that jewel loan without prejudice to his contentions in the Writ Petition, Learned Counsel for the Petitioner submitted that the Petitioner is not in a position to make such payment. In view of the same, it was ordered that the au