IN THE HIGH COURT OF JUDICATURE, ANDHRA PRADESH AT HYDERABAD (Special Original Jurisdiction) MONDAY, THE TWENTY NINTH DAY OF JUNE TWO THOUSAND AND NINE PRESENT THE HON'BLE MR JUSTICE GHULAM MOHAMMED and THE HON'BLE MR JUSTICE VILAS V. AFZULPURKAR WRIT PETITION NO : 1233 of 2008 Between: 1 J.S.Ramachandra Rao, S/o.J.V.S.S.N.Murthy, H.No.1-17/7, Teachers Colony, Nagulapalli(V) Anakapalli Post, Visakhapatnam Dist 2 J.V.S.S.Murthy, S/o.Late Nallayya, H.No.1-17/7, Teachers Colony, Nagulapalli(V) Anakapalli Post, Visakhapatnam Dist 3 Smt.J.Saraswathi, W/o.J.V.S.N.Murthy, H.No.1-17/7, Teachers Colony, Nagulapalli(V) Anakapalli Post, Visakhapatnam Dist 4 Smt.J.Tulasi Prasanna, W/o.Ramachandra Rao, H.No.1-17/7, Teachers Colony, Nagulapalli(V) Anakapalli Post, Visakhapatnam Dist 5 D.Sanyasi Rao, S/o.D.Satyanarana, H.No.1-17/7, Teachers Colony, Nagulapalli(V) Anakapalli Post, Visakhapatnam Dist ..... PETITIONER(S) AND 1 Bank Of India, Rep.by its Chief Manager, 2nd Floor,Fanta Plaza, Opp.Saraswathi Theatre,Daba Gardens,Visakhapatnam 2 Bank Of India, Rep.by its Authorized officer, 2nd Floor,Fanta Plaza, Opp.Saraswathi Theatre,Daba Gardens,Visakhapatnam .....RESPONDENT(S) Petition under Article 226 of the constitution of India praying that in the circumstances stated in the Affidavit filed herein the High Court will be pleased to to issue writ order or direction more particularly one in the nature of writ of Mandamus declaring the impugned possession Notice dt.14-12-2007 issued by the respondents U/R 8(1) of the Security Interest(enforcement Bank) Rules,2002 without issuing a notice U/Sec.13(2) of the Securization Act,as illegal,arbitrary and without jurisdiction and consequently set aside the same and to grant such other relief or reliefs Counsel for the Petitioner:MR.C.RAGHU Counsel for the Respondent No.: MR.S.SURYA PRAKASA RAO The Court made the following : THE HON'BLE MR JUSTICE GHULAM MOHAMMED and THE HON'BLE MR JUSTICE VILAS V. AFZULPURKAR W.P.No. 1233 of 2008 ORDER: (Per Ghulam Mohammed, J) This writ petition is filed seeking a writ of Mandamus to declare possession notice dated 14.12.2007 issued by the respondents under Rule 8 (1) of the Security Interest (Enforcement Bank) Rules,2002,(for short “the Rules”) without issuing a notice under Section 13(2) of the Seuritisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 ( for short ‘the Act’), as illegal and arbitrary. 2. The first and second petitioners are the absolute owners and possessors of the property bearing No.807/2, Door No.1/17/7, admeasuring 1355 square yards comprising of two storeyed building. The first petitioner availed a loan of Rs.35,00,000/- in the year 2006 by mortgaging the above said property and repaid an amount of Rs.3,00,000/- and thereafter, committed default. The loan amount as per the loan agreement has to be repaid within a period of 7 years. The outstanding loan is about Rs.38,34,782/-. While so, the respondent bank issued notice dated 4.8.2007 calling upon the petitioners to pay Rs.5,00,000/-for regularizing the account. Except the said notice, no other notice has been issued. The said notice cannot be construed as the notice under Section 13(2) of the Act. Thereafter, the respondent bank issued a possession notice dated 5.11.2007 to the petitioners under Rule 8(1) of the Rules to the petitioners. The respondent bank also issued a notice dated 14.12.2007 and the same was published on 17.12.2007 stating that the possession of the mortgaged property was taken. As such, the method adopted by the respondent bank is contrary to the provisions of the Act. 3. The learned standing counsel for the respondent Bank submits that a notice under Section 13(2) of the Act to repay the entire loan amount was issued on 4.8.2007 to the petitioners and they acknowledged the same on 13.08.2007. The petitioners did not give any reply to the said notice. The respondent Bank issued a possession notice dated 5.11.2007 under Section 13(4) of the Act to the petitioners and thereafter, a news paper notice dated 14.12.2007 was published in Eenadu Telugu Daily on 17.12.2007 stating that the respondent took symbolic possession of the mortgaged property on 05.11.2007. 4. On 28.1.2008, while ordering notice before admission, this court granted interim stay on condition of petitioners depositing an amount of Rs.5,25,000/- to the loan account within a period of six weeks from that date, but they have not complied with the order. 5. We have heard the learned counsel on either side and perused the record. The petitioners have already been issued notice under Section 13(2) of the Act and they have neither replied to the said notice nor did they repay the loan amount. Thereafter, the respondent bank issued notice under Section 13(4) of the Act. The contention of the petitioners that no notice under Section 13(2) of the Act was issued cannot be sustained since they acknowledged the said notice on 13.08.2007. Further, the petitioners have not deposited the amount in compliance of the order, dated 28.1.2008 passed by this court. Therefore, we do not find any infirmity in the procedure adopted by the respondent Bank in issuing the notices for recovery of the loan amount. 6. Hence, the writ petition is dismissed. But however, in the circumstances, the petitioners are at liberty to make a representation for appropriate relief to the respondent Bank, within a period of two weeks from the date of receipt of a copy of this order, and on such representation being made, the respondent bank shall consider and pass appropriate orders in accordance with law. No costs. _____________________ GHULAM MOHAMMED,J _____________________ VILAS V. AFZULPURKAR 29-06-2009 Stp ..... 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