IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT : THE HONOURABLE MR. JUSTICE C.K.ABDUL REHIM TUESDAY, THE 22ND FEBRUARY 2011 / 3RD PHALGUNA 1932 WP(C).No. 4565 of 2011(U) ------------------------------------- PETITIONER: ------------------- SHAMLA, AGED 31 YEARS, W/O.SHAMNADH. M., SUNI HOUSE, ATTAKULANGARA, MANACAUD, THIRUVANANTHAPURAM. BY ADV. SRI.A.F.SEBASTIAN. RESPONDENT: ---------------------- STATE BANK OF TRAVANCORE, REP. BY THE AUTHORISED OFFICER, (SARFEASI ACT), ZONAL OFFICE, KSHB COMPLEX, SHANTI NAGAR, THIRUVANANTHAPURAM – 695 001. BY SRI. R.S. KALKURA, S.C, S.B.T. THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 22/02/2011,THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: prv. C.K.ABDUL REHIM, J --------------------------------------- W.P(C) No.4565 of 2011-U ---------------------------------------- Dated this the 22nd day of February, 2011. J U D G M E N T Proceedings initiated under the Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (SARFAESI Act), consequent to default committed by the petitioner in repaying a housing loan availed from the respondent Bank, is the subject matter of challenge. As per Ext.P4 notice, steps under Section 13 (4) was initiated against the immovable property, which the secured asset. 2. According to the petitioner the loan in question was availed in the year 2008 with a repayment period of 20 years, which will expire only in the year 2028. The coercive steps are now being pursued without permitting the petitioner to regularise the account by paying the amount in default. It is also stated that when the steps were initiated, the petitioner had already cleared another business loan, which was availed from the very same Bank, by effecting W.P(C) No.4565 of 2011-U 2 payment of a sum of Rs.2,32,000/- and the said loan account now stand closed. Under the above mentioned circumstances, the petitioner is seeking to restrain steps under the SARFAESI Act on the premise that she will make payment of the amounts in default within a short period. 3. Standing counsel appearing for the respondent Bank opposed the prayer on the basis of a submission that the loan account is in chronic default and since the petitioner had defaulted payment of consecutive monthly instalments, the Bank had already filed an O.A before the Debt Recovery Tribunal which is now being pursued. 4. Considering the fact that the petitioner has not chosen to avail the alternative remedy provided under the statute, it may not be justified on the part of this Court in interfering with the proceedings. However, confronted with the above situation, learned counsel undertook that the petitioner is relinquishing all challenges against the proceedings and also relinquishing rights if any available to invoke statutory remedy. On the other hand, limited prayer W.P(C) No.4565 of 2011-U 3 is only to permit regularisation of the account. Considering the 'Master Circulars' issued by the Reserve Bank of India which is having statutory force, the respondent Bank is at an obligation to reclassify the debt as a 'performing asset' as and when the default is cleared payment. Therefore, I am of the view that, eventhough interference on merits is not proper, the petitioner can be permitted to regularise the account by payment of the amounts in default within a short time. 5. Accordingly, the writ petition is disposed of directing the respondents to keep in abeyance all further steps for dispossession and sale of the property, subject to condition of the petitioner remitting the amounts overdue for payment (defaulted instalments along with interest and expenses if any due) in 2(two) equal monthly instalments falling due on or before 15.3.2011 and on or before 31.3.2011 along with payment of regular monthly instalments due for the month of March 2011. 6. If payment of the defaulted amounts is regularised W.P(C) No.4565 of 2011-U 4 as directed above, the respondents shall permit the petitioner to continue payment of future monthly instalments in accordance with the original schedule of repayment. 7. It is made clear that, on the event of default in payment of any one of the instalments, the respondents will be free to proceed with further steps. It is made clear that the above relief is granted subject to condition that the petitioner is precluded from raising any subsequent challenge against the proceedings. C.K.ABDUL REHIM JUDGE ab