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2014 Supreme(Online)(KER) 38410
HIGH COURT OF KERALA
P.R.RAMACHANDRA MENON, J
K PADMAKUMAR – Appellant
Versus
AUTHORISED OFFICERCHIEF MANAGER – Respondent
WRIT PETITION (CIVIL) 24216/2014
The judgment underscores the balancing of creditor rights under the SARFAESI Act with debtor circumstances, permitting installment payments to avoid aggressive recovery actions.
Headnote:
Debt - Agricultural Loan - SARFAESI Act Section List - The court addressed the default on an agricultural loan under the SARFAESI Act, permitting a repayment plan while emphasizing the need for compliance to avoid further recovery actions.
Fact of the Case:
The petitioners took an agricultural loan secured by property but defaulted on repayments, prompting the bank to act under the SARFAESI Act, leading to the petitioners seeking relief from the court.
Finding of the Court:
The court found no wilful default by the petitioners and agreed to allow payments in installments, temporarily halting recovery proceedings, contingent on compliance with the payment schedule.
Issues: Whether the petitioners could be provided breathing space to repay the defaulted loan installments and what conditions would apply to avoid further bank recovery actions.
Ratio Decidendi: The court determined that a structured repayment plan could be implemented based on the circumstances of the petitioners' financial difficulties, reinforcing the need for compliance to avoid the bank's recovery actions.
Final Decision: Writ petition disposed with structured repayment plan for overdue amounts.
JUDGMENT
The petitioners availed an agricultural loan of Rupees Five lakhs from the 1st respondent Bank on the strength of security interest created over the property in question. Since the repayment could not be effected as scheduled, the Bank proceeded with steps under the SARFAESI Act, which made the petitioners to approach this Court by filing this writ petition. 2. The learned counsel appearing for the respondent Bank submits that the outstanding liability as on date is nearly Rs.4,52,411/ (Rupees Four lakhs fifty two thousand four hundred and eleven only), out of which, a sum of Rs.3,48,398/- (Rupees Three lakhs forty eight thousand three hundred and ninety eight only) is in respect of the defaulted instalments.
3. The learned counsel for the petitioners submits that the default was never wilful, but because of some unforeseen circumstances and that steps are being taken to have the 'overdue' amount cleared, for which some breathing time is sought for. It is stated that the petitioners do not dispute the liability, nor intend to avail statutory remedy by approaching the DRT.
4. After hearing both the sides, the petitioners are directed to satisfy the 'overdue' amount in respect of defaulted instalments, by way of 'six' equal monthly instalments, the first of it shall be effected on or before the 30th of October, 2014, followed by similar installments, to be effected on or before the 30th of the succeeding months. This shall be in addition to the liability of the petitioners to clear the regular EMIs. Subject to this, the recovery proceedings shall be kept in abeyance, for the time being and the loan account will stand regularised. It is made clear that, if any single default is committed with regard to the satisfaction of the 'overdue' as above, or if any two consecutive defaults are made with regard to the regular monthly installments, it will be open for the respondent Bank to proceed with further steps for realization of the entire amount in lump, by pursuing such steps from the stage where it stands now.
The writ petition is disposed of.
P.R. RAMACHANDRA MENON, JUDGE sp
