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2017 Supreme(Online)(KER) 6557
HIGH COURT OF KERALA
A. K. Jayasankaran Nambiar, J
C V SASI – Appellant
Versus
THE AUTHORISED OFFICER – Respondent
WRIT PETITION (CIVIL) 21311/2017
The court can permit structured repayment plans for borrowers facing financial hardship under the SARFAESI Act.
Headnote:
Loan - Securitization - SARFAESI Act - Sections not specified - Court's ruling allowed installment repayment due to financial hardship.
Fact of the Case:
The petitioner defaulted on a loan from the respondent bank, prompting the bank to initiate recovery proceedings under the SARFAESI Act. The petitioner contested this action seeking to repay the overdue amount in installments.
Finding of the Court:
The court acknowledged the petitioner's financial difficulties and ruled in favor of allowing repayment in 12 monthly installments while putting recovery proceedings on hold, contingent on timely payments.
Issues: Whether the court should permit the petitioner to repay the outstanding loan amount in installments despite defaulting on the loan.
Ratio Decidendi: The court emphasized the importance of allowing borrowers facing financial hardship to repay their debts in manageable installments rather than facing immediate recovery actions.
Final Decision: The writ petition was disposed of, allowing repayment in installments with conditional terms.
J U D G M E N T
The petitioner, who had availed a loan from the respondent bank, defaulted in repayment of the same. Consequently, the respondent bank initiated proceedings under the Securitisation and Reconstructions of Financial Assets and Enforcement of Security Interest Act, 2002, hereinafter referred to as the 'SARFAESI Act', to recover the loan amounts. Ext.P1 is the demand notice issued by the respondent bank. In the writ petition, the petitioner impugns the steps initiated by the respondent bank for recovery of the loan amounts.
2. I have heard the learned counsel appearing for the petitioner as also the learned Standing counsel appearing for the respondent bank.
3. On a consideration of the facts and circumstances of the case and the submissions made across the bar, I note that the sole prayer of the petitioner is to permit him to remit the balance amounts outstanding to the respondent bank in easy installments. Taking into account the plea of financial hardship raised by the petitioner, I dispose the writ petition with the following directions:-
(i) The overdue amount, in respect of the loan availed by the petitioner, as of today, is stated to be Rs.7,14,429/- together with accrued interest. Accordingly, if the petitioner pays the said amount of Rs.7,14,429/- together with accrued interest in 12 equal and successive monthly installments commencing from 20.07.2017, and continues to keep up the regular installment payments as per the original loan schedule, then the further proceedings initiated against him by the respondent bank shall be kept in abeyance.
(ii) It is further made clear that if the petitioner commits a default in respect of any of the installments, he will lose the benefit of this judgment and the respondent bank will be free to continue the recovery proceedings against him from the stage at which they presently stand.
(iii) The respondent bank shall furnish the petitioner with an up-to-date statement, of the dues position together with interest, within ten days from today so as to enable the petitioner to discharge the liability in accordance with the directions in this judgment.
