ORDER:

(Ujjal Bhuyan, J.)

1. Heard Mr.Gopala Rao Amancharla V, learned counsel for the petitioners and Mr.Namavarapu Rajeshwar Rao, learned Assistant Solicitor General of India for respondents 2 and 3.

2. Having regard to the subject matter of the writ petition and the order which we propose to pass, issuance of notice to respondent Nos.1, 4 and 5 is considered not necessary.

3. It is stated that petitioner No.1 is a Micro, Small and Medium Enterprise (MSME) and is covered under the provisions of the Micro Small and Medium Enterprises Development Act, 2006 (briefly ‘the MSME Act’ hereinafter). In connection with its commercial activities, it had availed a loan from respondent No.4 i.e., Indusind Bank Limited. However, it is stated that giving a complete gobye to the beneficial provisions of the MSME Act and in a highhanded manner, the loan account of the petitioners was classified as Non-Performing Asset (NPA). Thereafter, respondent No.5, being the Authorized Officer of respondent No.4, issued demand notice to the petitioner under 13(2) of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (briefly ‘the SARFAESI Act’ hereinafter) dated 29.07.2021 calling upon the petitioners to pay the aggregate outstanding demand of Rs.30,95,566.37 as on 27.02.2021, together with further interest at documented rate w.e.f., 28.02.2021 till the date of payment with costs.

4. Learned counsel for the petitioners submits that the petitioners had submitted a number of representations and objections to respondents 4 and 5 upon receipt of the notice under 13(2) of the SARFAESI Act. One such representation is annexed to the writ petition which is dated 21.06.2021, as per which petitioners requested respondent No.4 for restructuring of the loan. However, instead of considering the same, respondent No.4 is insisting upon the petitioners to make the entire payment at one go following the above notice.

5. Apprehending that coercive steps may be taken against the petitioners, present writ petition has been filed seeking a declaration that action of respondents 4 and 5 are in violation of the provisions of the MSME Act and to declassify the NPA status of the loan account of the petitioners.

6. Recently this court in W.P.No.25502 of 2021 had the occasion to examine the provisions of Section 13 of the SARFAESI Act, more particularly that of sub-section (3-A) thereto, which provides that if the borrower makes such a representation or raises any objection upon receipt of notice under sub-section (2), the secured creditor has to consider such representation or objection and communicate to the borrower the reasons for its decision. As per the proviso, such communication of the reasons or the decisions would not confer any right to the borrower to initiate an action in law. Relevant portion of the order dated 26.10.2021 passed in W.P.No.25503 of 2021 is extracted hereunder:

“5. A careful analysis of sub-section (3-A) of Section 13 of the SARFAESI Act would go to show that upon receipt of notice issued by the secured creditor under sub-section (2), the borrower has a right to make a representation, or raise any objection, as to the notice so issued. If the borrower exercises that right, then, it is incumbent upon the secured creditor to consider such representation or objection. The use of the word ‘shall’ in sub-section (3-A) is indicative of the legislative intent of considering such representation or objection, by the secured creditor mandatory. If the secured creditor is not satisfied with the representation or objection, and finds it to be unacceptable, or untenable, he shall communicate such decision within fifteen days along with the reasons to the borrower.

6. While the statute is silent as to what happens in case of a positive decision by the secured creditor on consideration of such representation or objection, it is axiomatic that once the decision is taken either way, the same has to be com