The court emphasized the obligation of loan repayment and the conditions for restructuring loans under the SARFAESI Act.

ORAL ORDER

The petitioner is estranged from her husband [the second respondent, who is the borrower]. In the memorandum of petition, the petitioner has detailed the matrimonial proceedings with the second respondent, including the transfer petition pending before the Apex Court and the outcome in the application filed by her with the Debt Recovery Appellate Tribunal [DRAT] invoking Section 17 of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act , 2002 [for short, 'SARFAESI Act']. The petitioner seeks direction to the first respondent to restructure/reschedule the outstanding loan amount permitting her to pay the outstanding 120 monthly instalments.

2. This Court, on 24.03.2025, taking on record the circumstances above and recording that the second respondent, because of their floundering relationship, has defaulted in paying EMI resulting in the petitioner's eviction from the subject property, has directed the first respondent to restore possession of the property to the petitioner forthwith. On 26.03.2025, Mr. Francis Xavier, the learned counsel for the first respondent, has stated before this Court that if the petitioner offers a sum of Rs.7,63,000/-, the loan would be regularized and the petitioner will have the advantage of EMI. This Court has directed the petitioner to pay a sum of Rs.3,00,000/- within a week directing the first respondent to accept the same subject to the result of the petition.

3. Mr. Devendra Gowda R. R, the learned counsel for the petitioner, submits that after this Court's order dated 26.03.2025, the petitioner has deposited Rs.3,00,000/- on 02.04.2025, Rs.81,500 on 19.04.2025 and a sum of Rs.1,50,000/- on 24.01.2025 [prior to the interim orders of this Court].

Mr. Francis Xavier has stated before this Court [of course, without prejudice to the first respondent's interest] that the petitioner can offer a sum of Rs.3,65,298/- by the end of July 2025 for regularization of the loan and to be entitled to EMI. The learned counsel has also stated that the petitioner may have to pay further amounts towards certain charges.

4. Mr. Devendra Gowda R. R. submits that the second respondent has deliberately abstained from participating in the proceedings, and this is despite the Apex Court’s decision in the pending proceedings directing him to participate in the present proceedings, and the learned counsel submits that this Court must direct the first respondent to include the outstanding as part of a regularization with just amount as EMIs.

5. In response, Mr. Francis Xavier submits that the inter se dispute between the petitioner and the second respondent cannot be a reason to stall the recovery proceedings under the SARFAESI Act, especially when the petitioner herself admits that she has failed in the proceedings under Section 17 thereof in so far as the request for interim order, and the learned counsel reiterates that if a sum of Rs.3,65,298/- and further charges are paid, the first respondent will regularise the loan which would enable the petitioner to avail EMI.

6. This Court finds considerable force in the first respondent's contention as regards this Court intervening because of the dispute between the petitioner and the second respondent, especially when nothing is brought on record to justify a direction to the first respondent to restructure/reschedule the loan. However, with the first respondent taking a stand that if the petitioner offers Rs.3,65,298/-, the loan could be regularized with the petitioner being entitled to EMI, there must be just orders.

7. This Court, on a careful consideration of all the circumstances, is of the view that the petitioner, notwithstanding her compelling constraints, must pay what is due for regularization of the