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2017 Supreme(Online)(KER) 21533
HIGH COURT OF KERALA
SHAJI P.CHALY, J
MOLLY C R – Appellant
Versus
THE ASSISTANT REGISTRAR OF CO-OPERATIVE SOCIETIES – Respondent
WRIT PETITION (CIVIL) 22444/2013
Borrowers have the right to be notified of proceedings, and courts may allow flexible repayment terms based on financial circumstances.
Headnote:
Mortgage - Writ Petition - ARC Proceedings - Interpretation of Repayment Terms and Financial Considerations.
Fact of the Case:
A borrower took a mortgage loan and defaulted on payments, leading the lender to secure an award without notifying the borrower. The borrower became aware of the proceedings only after demand was made, seeking to quash the ARC proceedings.
Finding of the Court:
The court, considering the borrower's claims and the economic situation, directed the borrower to repay the outstanding amount in installments while allowing the bank to resume proceedings if payments are not made.
Issues: Whether the borrower received proper notice for the ARC proceedings and the viability of seeking a repayment plan.
Ratio Decidendi: The court emphasized the importance of notice in proceedings and balanced between the borrower's obligations and the financial realities, permitting a staggered repayment plan.
Final Decision: Writ petition disposed with repayment directed in installments.
J U D G M E N T
Petitioner had on 5.1.2009 availed a mortgage loan of Rs.1,50,000/- from the 3rd respondent bank, which was repayable in 5 years i.e., upto 4.1.2014 with interest at the rate of 13% per annum. Apparently the amounts were not repaid, consequent to which, bank proceeded and secured an award in ARC No.2067/2010. According to the petitioner, petitioner has not received notice in the ARC proceedings and came to know of the proceedings only when Ext.P2 demand is received in execution. Therefore, petitioner seeks to quash ARC proceedings as well as Ext.P2 demand.
2. A detailed counter affidavit is filed by the 3rd respondent refuting the claims and demands raised in the writ petition. I am not traversing through the counter affidavit in detail in view of the limited submission made by the learned counsel for petitioner that, if sufficient installment arrangement is provided to the petitioner, petitioner will repay the outstanding amounts and sought for 20 installments.
3. Having heard learned counsel for petitioner, learned Standing Counsel appearing for the 3rd respondent and perusing the pleadings and documents on record and taking into account the present adverse financial as well as economic situation prevailing in the community, petitioner is directed to repay the outstanding amounts in accordance with the ARC proceedings along with accrued interest and cost, in 12 equated monthly installments starting from 10.11.2017 onwards and on the corresponding date of the succeeding months. Needless to say, if any of the directives are not complied with by the petitioner, bank will be at liberty to resurrect the proceedings and recover the amount in lump.
Writ petition is disposed of accordingly.
