The Writ Petition challenging NPA classification by a private bank is not maintainable under Article 226, and the proper remedy lies with the Debt Recovery Tribunal.

JUDGMENT

Dated this the 20^th day of February, 2026

1. The Petitioner No.1 is a public limited company engaged in tea plantation and claims ownership of three tea estates having a total area of approximately 2,292 Acres. The Petitioner Nos.2 to 5 are its Directors/Officers. The Petitioner No.1 availed three credit facilities from the Respondent No.1/Bank in the year 2019, mortgaging the said three tea estates, on migration of the financial facilities which were availed from HDFC Bank. The financial facilities are Cash Credit - Agricultural Loan (CC-AL), Cash Credit - Overdraft Limit (CC-OL), and ECLGS Term Loan. The Petitioner Nos.2 to 5 are the personal guarantors to the said credit facilities. The Petitioners are aggrieved by the classification of the credit facilities availed by the Petitioners as Non-Performing Asset (NPA) with effect from 04.11.2025 and the consequent invocation of personal guarantees of the Petitioner Nos.2 to 5 and debit freezing of the accounts of the Petitioner No.1. According to the Petitioners, the loans have not become NPA as the overdue amount required for regularisation is only Rs.2,22,300/-, whereas the account of the Petitioner No.1 as from the date of debit freezing was having an amount of Rs.5,57,466/- and the classification as NPA is in violation of the RBI prudential norms. The total exposure as on the date of NPA classification is Rs.7.02 Crores. The Respondents were fully satisfied with the financial performance of the Petitioners, but the stance of the Respondents underwent a drastic change when the State of Kerala filed O.S.No.46/2025 before the Sub Court, Kattappana, in July 2025, questioning the title of the Petitioner No.1 over its three estates.

2. The Respondent Nos.1 to 3 filed Counter Affidavit raising the question of maintainability of the Writ Petition and opposing the prayers in the Writ Petition.

3. I heard the learned Counsel for the Petitioners, Sri. Joseph Mary Das, and the learned Counsel for the Respondents, Sri.Sunil Shanker.

4. The learned Counsel for the Petitioners contended that the Petitioner No.1 is the owner of three tea estates having a total extent of nearly 2,292 Acres and the related infrastructure therein, which it acquired in the years 1923, 1946 and 1954. There are more than 700 plantation workers working in the estates. The Respondent No.1/Bank itself valued the said estates approximately at Rs.154 Crores at the time of sanctioning of the loan in the year 2019, as against the total exposure of around Rs.7 Crores. Out of the three credit facilities availed by the Petitioners, the CC-OL facility alone was classified as NPA on account of the refusal of the Respondents to renew the same. The Respondents renewed CC-OL on 04.11.2024 for six months. On the expiry of the facility on

08.05.2025, the Petitioners were under the bona fide belief that the said facility would be renewed. As per Ext.P5 dated 08.04.2025, the Petitioner No.1 was requested to submit certain documents for the renewal of the facility. Respondents sent Ext.P11 Email dated 12.05.2025 threatening to classify CC-OL as NPA with effect from 04.11.2025. Thereafter, the Respondents sent Ext.P16 Email dated 25.07.2025 forwarding the Application forms for renewal of CC-AL and CC-OL. The Petitioner No.1 submitted all the required documents as per Ext.P7 Letter dated 07.08.2025 and had been expecting a favourable response from the Respondents. But the Respondents issued Ext.P1 effecting debit block of the accounts, alleging that the accounts have turned NPA. Immediately, the Respondents issued Ext.P3 Guarantee Invocation Letter dated 13.11.2025 to the Petitioner Nos.2 to 5, alleging a total outstanding balance of around Rs.6.7 Crores.

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