The Permanent Lok Adalat has jurisdiction to adjudicate disputes under the SARFAESI Act and properly set aside the bank's possession notices against the legal heirs after determining substantial repayments were made.

JUDGMENT :

S.K. PANIGRAHI, J.

1. The Petitioner, in this Writ Petition, has challenged the order dated19.07.2023 passed by the leaned Permanent Lok Adalat (PUS), Balasore in PLA Case No.83 of 2022 setting aside the notices issued under the SARFAESI Act, 2002 against the legal heirs of the deceased borrower and taking symbolic possession of their house. It was further directed that the mortgage agreement by depositing of title deeds with the Petitioner/Bank executed by later Kusha Bharati and his wife Satyabati Bharati involving M/S Traini Store would be discharged after depositing of rupees 15 lakh by the Opposite Party and the properties would be free from the mortgage debts. It was also directed that all the deeds of mortgage would be returned to the Opposite Party without any extra payment along with the NOC after the amount of rupees 15 lakh is deposited. Hence, this Writ Petition.

I. FACTUAL MATRIX OF THE CASE

2. The brief fact of the case is that:

(i) One late Kusha Bharati, being the proprietor of M/s. Tarini Store (herein after referred as the Borrower), had approached the Petitioner/Bank for sanction of a Business Loan in the nature of overdraft facility, which was eventually sanctioned and availed vide Loan Account No.060905011084. Accordingly, a Credit Arrangement Letter (hereinafter referred as "Sanction Letter") dated 25.02.2019 was issued in favour of the borrower, which was duly accepted followed by execution of several loan documents including the loan agreement. Ms. Satyabati Bharati along with late Kusha Bharati stood as Guarantor in the said loan account for which she had exclusive liability towards closure of the loan account in case of failure on the part

(ii) The overdraft facility granted to the Borrower was of Rs.1,25,00,000/-(Rupees One Crore Twenty-five Lakhs Only) and the said credit facility was secured by the creation of equitable mortgage in respect of the property situated at Plot No. 698/1163, Khata No- 26/31, Mouza - Sundari, P.S. No. - 157, P.S./Tahasil/District - Balasore, admeasuring an area of Ac 0.08 Dec., Plot No. 696, Khata No - 380/1076, Mouza - Sundari, P.S. No. - 157, P.S./Tahasil/District - Balasore, admeasuring an area of Ac 0.02 Dec. In order to create the equitable mortgage, the Borrower has deposited the title deed bearing Nos.2224 and 3982 dated 06.05.1992 and 23.06.2008 respectively.

(iii) Besides the overdraft facility late Kusha Bharati along with Ms.Satyabati Bharati had also availed a loan against property for an amount of Rs.14,40,000/- vide sanction letter dated 07.03.2019 in respect of Loan Account No. LBBAL00004934887. The additional credit facility was also secured by the collateral security over the Plot No.1180/5649, Khata No.584/1642, Mouza - Sunhat Unit No.30; P.S. - Balasore Town, P.S. No.- 30, Tahasil/District - Balasore, admeasuring an area of Ac0.092 Dec.

(iv) Again in the year 2019 the Borrower approached the Petitioner/Bank to avail a Bank Guarantee of Rs.l,02,00,000/-(rupees one crore two lakh), which was issued to the Borrower vide BG No.1500BGR0005020 on 31.07.2019 vide Loan Account No.150060000049. The Bank Guarantee issued by the Bank and availed by the Borrower was also covered with an extended mortgage of the property already mortgaged in previous two loans.

(v) After availing the credit facilities, the Borrower, late Kusha Bharati and Mrs. Satyabati Bharati (hereinafter collectively called as "Borrowers") failed to maintain the financial discipline with the Petitioner/Bank. There were defaults in the facility accounts compelling the Bank to pay and initiate legal action against the Borrowers. As a matter of process, the Petitioner/Bank, before approaching the Court or i