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2018 Supreme(Online)(KER) 46597
HIGH COURT OF KERALA
P. B. Suresh Kumar, J
vs
WRIT PETITION (CIVIL) 13900/2018
SRI.K.C.SUDHEER, SRI.GILBERT GEORGE CORREYA, SC
A borrower may be provided a reasonable chance to repay overdue amounts under the Act, which may result in deferment of coercive actions if compliance is achieved.
Headnote:
Loan - Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act - Section 13 - The court directed the petitioner to clear overdue loan amounts through structured payments while allowing deferment of coercive measures upon compliance.
Fact of the Case:
The petitioner and her sister took a term loan from a bank but failed to make payments. The bank initiated proceedings under the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act due to non-payment.
Issues: Whether the petitioner should be granted a reprieve from immediate dispossession due to non-payment of loan instalments and whether a structured repayment plan could be established.
Ratio Decidendi: The court found that a reasonable time for repayment should be granted considering the extenuating circumstances of the petitioner, allowing her to avoid forcible dispossession while adhering to a repayment schedule.
Final Decision: Writ petition disposed with a structured repayment plan and deferment of coercive actions upon compliance.
J U D G M E N T
Petitioner along with her sister availed a term loan from Kerala State Co-operative Bank Limited (the bank). They have not remitted the instalments of the loan as agreed. Consequently, proceedings have been initiated by the bank under the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (the Act) for realisation of the outstanding in the loan account. The petitioner is aggrieved by the said proceedings.
2. Heard the learned counsel for the petitioner as also the learned counsel for the bank.
3. When the matter was taken up, the learned counsel for the petitioner pointed out that non-payment of the instalments of the loan by the petitioner was due to reasons beyond her control and not wilful and that if a reasonable time is granted, the petitioner is prepared to liquidate the overdue in the loan account, so that she can repay the outstanding in the loan account in instalments.
4. The learned counsel for the bank, on instructions, submitted that a sum of Rs.2,68,693/- is overdue in the loan account. The learned counsel also submitted that steps have already been taken to dispossess the petitioner from the security and they will be dispossessed on 16.04.2018.
5. Having regard to the facts and circumstances of the case as also the orders passed by this Court in similar writ petitions, this writ petition is disposed of as follows :
(i) The petitioner shall pay Rs.20,000/- on or before 16/04/2018, Rs.30,000/- on or before 30/04/2018 and the balance overdue in the loan account with the interest due in ten equal monthly instalments commencing from 01.06.2018. The petitioner shall also pay, in addition, the regular instalments of the loan on the due dates.
(ii) If the petitioner remits the overdue in the loan account as directed above, the bank shall regularise the loan account so as to enable the petitioner to liquidate the remaining liability in accordance with the terms of the loan.
(iii) Needless to say that if the petitioner liquidates the overdue as directed above, coercive action against the petitioner shall be deferred. It is, however, made clear that if the petitioner commits default in remitting any one of the instalments as directed, the proceedings initiated against the petitioner under the Act can be continued.
