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2014 Supreme(Online)(KER) 22059
HIGH COURT OF KERALA
P.R.RAMACHANDRA MENON, J
LIDIYA ALFRED – Appellant
Versus
THE AUTHORIZED OFFICER – Respondent
WRIT PETITION (CIVIL) 18191/2014
The court established that debtors facing unforeseen circumstances may be granted relief through structured repayment plans, balancing legal rights of banks with equitable considerations.
Headnote:
Loan - SARFAESI Act - Section on Security Interest - Court allowed repayment in installments, ensuring legal balance between creditor's rights and debtor's circumstances.
Fact of the Case:
The petitioner took a loan of Rs. 6,00,000/- from the respondent Bank and defaulted due to unforeseen circumstances, seeking time to repay without disputing liability.
Finding of the Court:
The court found it reasonable to grant the petitioner the opportunity to repay overdue amounts in installments, thus allowing the regularization of the loan account and halting coercive actions.
Issues: Whether the petitioner can be permitted to repay overdue loan amounts in installments despite default.
Ratio Decidendi: The court emphasized the importance of balancing creditor rights and debtor circumstances by accommodating repayment plans under specific conditions.
Final Decision: Writ petition disposed allowing repayment in four installments.
JUDGMENT
The petitioner availed a loan of Rs. 6,00,000/- from the respondent Bank, creating security interest over the property in question. By virtue of the default on the part of the petitioner, the Bank is proceeding with steps under the SARFAESI Act , which in turn is sought to be intercepted in this writ petition.
2. The learned Counsel for the petitioner submits that the default occurred was not because of any wilful laches or deliberate negligence, but because of some unforeseen circumstances. The learned Counsel for the petitioner submits that the petitioner does not intend to dispute the liability or to avail the statutory remedy by approaching the DRT. It is however assured that the entire 'overdue' amount as well as regular E.M.Is will be cleared, without fail, if some breathing time is given.
3. Despite completion of service of notice, there is no representation for the respondent. Hence it is reasonably presumed that respondent has no objection in regularizing the loan account.
4. After taking note of the particular facts and circumstances, this Court finds it fit and proper to permit the petitioner to clear the liability towards the 'overdue' amount by way of 'four' equal monthly installments, the first of which shall be effected on or before 15.11.2014 followed by similar installments to be effected on or before 15th of the succeeding months. Subject to this, the loan account will stand regularised and all coercive proceedings shall be kept in abeyance. This will be in addition to the liability to clear the regular monthly installments as well. It is further made clear that, if the petitioner commits any default in remitting the overdue amount/arrears as above or in the event of committing two consecutive defaults in respect of the regular E.M.Is payable, the respondent Bank will be at liberty to proceed with further steps for realisation of the entire outstanding liability in a lump, pursuing such steps, from the stage where it stands now.
The writ petition is disposed of as above.
