Accounts becoming NPAs are not irreversible acts, and payment of amounts due at a particular point of time towards interest and principal is sufficient for the account not to be treated any longer as an NPA.

JUDGMENT

Avneesh Jhingan, J. - The present writ petition has been filed seeking quashing of order dated 12.01.2018 (Annexure P-7) passed by the District Magistrate, Rohtak under section 14 of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (for brevity 'the Act') for providing police help to take over possession of the mortgaged residential house.

2. Petitioner No.1 is son of petitioner No.2. Both mother and son are the borrowers of loan. Punjab National Bank, Delhi Branch; Divisional Office, Recovery Branch, Punjab National Bank, Rohtak; Branch Manager, Punjab National Bank, Branch Office, Meham; District Magistrate, Rohtak and Tehsildar, Meham, District Rohtak have been arrayed as respondents No.1 to 5 respectively, in this writ petition.

3. Petitioner No.1 and 2 availed term loan of Rs. 8,01,000/- and cash credit limit of Rs. 2 lakhs from respondent No.3. The credit facilities were sanctioned on 18.08.2016. The term loan was to be prepaid in 60 equal monthly instalments (EMI's). In order to secure the credit facilities availed, residential house measuring 69.83 sq. yards bearing House No.138, Ward No.1, Meham, District Rohtak was mortgaged.

4. The petitioners failed to maintain financial discipline of the credit facilities availed. The accounts were classified as Non-Performing Assets (NPAs) on 04.08.2017.

5. Respondent No.3 issued notice under Section 13(2) of the Act on 04.08.2017. As on 29.07.2017, amounts of Rs. 8,15,042/- in the term loan and Rs. 2,19,668/- in the Cash Credit along with interest and other charges were outstanding. Petitioners failed to repay the amount. Respondent No.3 vide letter dated 11.08.2017 asked the petitioners to contact the bank for clearing the loan amounts. A legal notice dated 22.08.2017 was also issued by respondent No.3. Notice dated 07.10.2017 was issued under Section 13(4) of the Act. Thereafter, an application under Section 14 was moved by respondent No.3. After giving an opportunity of raising objections to the application, respondent No.4 vide letter dated 12.01.2018, directed Tehsildar, Meham to take over possession of mortgaged property and hand over the same to the authorised officer of the Bank.

6. Aggrieved of the proceedings for taking over possession of the secured property, the present writ petition has been filed.

7. On 05.03.2018, petitioners brought a draft of Rs. 2 lakhs to establish their bona fides. Notice of motion was issued and dispossession of the residential house was stayed subject to the petitioners' depositing demand draft of Rs. 2 lakhs with respondent No.3.

8. On 13.08.2018, learned counsel for the petitioners prayed for time to deposit overdue instalments along with interest at the rate of 8.65% so that the accounts of the petitioners can be regularised.

9. Heard learned counsel for the parties.

10. Learned counsel for the petitioners stated that an amount of Rs. 2 lakhs has already been deposited in compliance with the order dated 05.03.2018. It was further stated that the petitioners would clear the entire outstanding amount of cash credit limit within three days. It was next submitted that petitioners will clear the overdue instalments along with reasonable interest and would deposit instalments due till December, 2018 in advance, within a period of 15 days and the petitioners undertake that future instalments would be paid on time. It was prayed that bank may not charge the legal expenses & penal interest and on payment of overdues, the term loan account should be regularised.

11. Learned counsel for the respondent-bank contended that the calculation of the overdue amounts as on 30.06.2018 has been annexed with the reply. In the calculation chart, the bank has charged agreed rate of interest @ 8.65% on the term loan plus 2% penal interest and legal expenses of Rs. 58,349/-. It was argued that as regard cash credit limit, a total amount of Rs. 2,28,000/- is due.

12. Learned counsel for the petitioner