IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT : THE HONOURABLE MR. JUSTICE S.SIRI JAGAN THURSDAY, THE 28TH JULY 2011 / 6TH SRAVANA 1933 WP(C).No. 586 of 2009(T) ----------------------------------- PETITIONER(S): ----------------------- THOMAS LOUIZ, AGED 58 S/O.LATE LOUIZ, CHIRAMEL HOUSE MANIKINAR PO, NELLIMATTOM,KOTHAMANGALAM, KUTTAMANGALAM VILLAGE, KOTHAMANGALAM TALUK ERNAKULAM DISTRICT. BY ADV. SRI.VARGHESE C.KURIAKOSE RESPONDENT(S): ---------------------------- 1. STATE OF KERALA, REPRESENTED BY SECRETARY, MINISTRY OF FINANCE TRIVANDRUM. 2. KERALA FINANCIAL CORPORATION VELLAYAMBALAM, TRIVANDRUM 3. THE BRANCH MANAGER KERALA FINANCIAL CORPORATION PERUMBAVOOR BRANCH, PERUMBAVOOR. 4. THE DEPUTY TAHSILDAR REVENUE RECOVERY, KERALA FINANCIAL CORPORATION ERNAKULAM ,KALOOR, KOCHI-17. 5. THE ERNAKULAM DIST CO-OP.BANK HEAD OFFICE, KAKKANADU, REP. BY ITS GENERAL MANAGER. R2 & R3 BY ADV. SRI.K.JAJU BABU,SC,KERALA FINANCIAL COR SRI.M.M.SAYED MUHAMMED, SC, KFC FOR R2-3 BY ADV. SRI.P.V.SURENDRANATH, SC BY CO.OP. BANK THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 28/07/2011, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: W.P.(C) NO.586/2009 APPENDIX P1:- COPY OF THE LOAN PROCESSING FEES ISSUED ON 6.3.2003. P2:- COPY OF THE FIRST PAGE OF THE LOAN SANCTION ORDER DTD. 6.5.2003. P3:- COPY OF THE LETTER DTD. 10.8.1995 ISSUED BY THE DISTRICT CO-OP BANK, ERNAKULAM. P4:- COPY OF THE DEMAND NOTICE UNDER SECTION 7. P5:- COPY OF THE DEMAND NOTICE SECTION 34 NOTICE. P6:- COPY OF THE STATEMENT OF ACCOUNTS PERTAINING TO LOAN TRANSACTION NO.030383810 DTD. 14.8.2007 . P7:- COPY OF THE STATEMENT OF ACCOUNT DTD. 14.8.2007 IN RESPECT OF LOAN ACCOUNT NO.030383890. P8:- COPY OF THE LETTER OF REQUEST DTD. 24.12.2004. P9:- COPY OF THE INTERIM ORDER IN WPC. 14751/2006 IN IA. NO.4091/2008 DTD. 31.3.2008 FILED BY THE DISTRICT CO-OP.BANK. P10:- COPY OF THE REQUEST DTD. 11.8.2008 SUBMITTED BY THE PROPOSED PURCHASER FOUND OUT BY THE PETITIONER BEFORE THE 4TH RESPONDENT. P11:- COPY OF THE COMMUNICATION DTD. 14.8.2008 ISSUED BY THE 4TH RESPONDENT TO THE SUB REGISTRAR, KOTHAMANGALAM LIFTING THE ATTACHMENT. P12:- COPY OF THE NOTICE DTD. 21.8.08. P13:- COPY OF THE COMMUNICATION DTD. 21.8.08 ISSUED BY THE 4TH RESPONDENT TO THE SUB REGISTRAR. P14:- COPY OF THE ATTACHMENT ORDER DT.D 4.1.2008. P15:- COPY OF THE NOTIFICATION APPEARED IN THE DESHABHIMANI DAILY FOR SALE ON 5.11.2008 BY THE 4TH RESPONDENT. RESPONDENT'S EXHIBITS R3(a):- COPY OF THE LATES STATEMENT OF ACCOUNTS ISSUED BY KFC. TRUE COPY P.A. TO JUDGE tss S. SIRI JAGAN, J. ------------------------------------------- W.P.(C) No.586 OF 2009 ---------------------------------------------- Dated this the 28th day of July, 2011 JUDGMENT The petitioner is a borrower of money from the 2nd respondent Kerala Financial Corporation. As security for the amounts advanced by the 2nd respondent to the petitioner, the petitioner mortgaged six items of properties belonging to the petitioner. The petitioner defaulted repayment of loan amounts to the Kerala Financial Corporation. The Kerala Financial Corporation initiated proceedings under the Revenue Recovery Act for recovery of the loan amounts by sale of the mortgaged properties. That is under challenge in this writ petition. It is submitted that out of the six items of properties against one item, the KFC has already proceeded against, under Section 29 of the SARFAESI Act. The petitioner’s contention in this writ petition is that the petitioner would be able to fetch better price for the properties, if the petitioner is allowed to sell the properties by private negotiations. The petitioner, therefore, seeks the following reliefs: W.P.(C)No.586/09 2 “(i) Declare that the entire proceedings initiated by respondents 2 to 4 under the provisions of the Kerala Revenue Recovery Act, 1968 (Kerala Act, 15 of 1968) for recovering the amounts from the petitioner and culminating in Ext.P4, P5, P14 and P15 is illegal, unsustainable and incorrect in the light of Section 34 of the Recovery of Debts Due to Banks and Financial Institutions Act, 1993. (ii) Issue a writ, order or direction in the nature of Mandamus or other appropriate writ directing the respondents 2 to 4 or the concerned among them not to sell, confirm, and issue sale certificate in respect of property covered by Ext.P14 and P15 notifications which is subject matter of alleged mortgage in favour of the respondents 2 and 3. (iii) Issue a writ, order or direction in the nature of Mandamus or other appropriate writ directing the respondents 2 to 4 to forthwith take up Ext.P8 and grant permission to sell the properties mentioned in Ext.P14 attachment order and Ext.P15 sale notification and grant a period of 12 months to the petitioner to close the loan transactions on a one time settlement basis. (iv) Issue a writ, order or direction in the nature of mandamus or other appropriate writ directing the respondents 2,3 and 4 or the concerned among them to forthwith credit the proceeds of the sale dated 04.03.2006 received by them from sale of the part of the mortgaged property as on that date and to recompute the amounts by removing penal interest and excessive interest claimed and furnished a detailed and accurate statement of account to the petitioner so as to enable him to arrange private sale and one time settlement of the loan transaction. (v) Allow the petitioner to recover the full costs incurred for the institution and conduct of the writ petition from respondents 2,3 and 4”. W.P.(C)No.586/09 3 2. This is opposed by the learned counsel for the KFC. According to him, the writ petition is only a ruse to protract the recovery proceedings and there is no bona fides in the same. They categorically state that they are not agreeable for letting the petitioner to sell the property by private negotiations, insofar as the properties are the secured assets of the KFC. 3. I have considered the rival contentions in detail. I am of opinion that without the consent of the KFC, the petitioner cannot seek a direction from this Court to the KFC to permit the petitioner to sell the mortgaged properties by private sale. If that is done, that would affect the legal rights of the KFC. The properties are mortgaged to them and it is their security for due repayment of the loan amounts due from the petitioner. If the petitioner is allowed to sell the same by private sale, the security of the KFC for their amounts would be lost. Insofar as the KFC is not agreeable for private sale of the property, I cannot countenance the claim of the petitioner in this writ petition. Apart from that, it is more than two years now. Nothing concrete has been suggested by the petitioner. W.P.(C)No.586/09 4 The petitioner has not been able to bring before this Court any person willing to purchase the properties at any price. In the above circumstances, I do not find any merit in this writ petition and accordingly, the same is dismissed. S. SIRI JAGAN, JUDGE acd W.P.(C)No.586/09 5