IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT : THE HONOURABLE MR. JUSTICE THOTTATHIL B.RADHAKRISHNAN TUESDAY, THE 14TH OCTOBER 2008 / 22ND ASWINA 1930 WP(C).No. 20332 of 2008(U) -------------------------- CMP.1879/2008 of C.J.M., ALAPPUZHA .................... PETITIONERS: ----------------------- 1. S.M.LALITHAMBIKA, W/O. LATE RADHAKRISHNAN, SANKAR VILLA, CMC 10, CHERTHALA. 2. R.JAYASANKAR,S/O.RADHAKRISHNAN, SANKAR VILLA, CMC 10, CHERTHALA. REPRESENTED BY HIS POWER OF ATTORNEY HOLDER JAYALAKSHMI, D/O.LALITHAMBIKA,SREE BHADRAM, MAYITHARA P.O.,CHERTHALA. 3. JAYALAKSHMI,D/O.LALITHAMBIKA SREE BHADRAM, MAYITHARA P.O.,CHERTHALA. BY ADV. SRI.P.C.CHACKO(PARATHANAM) RESPONDENTS: ------------------------ 1. THE FEDERAL BANK LTD. REPRESENTED BY ITS CHIEF MANAGER, CHERTHALA BRANCH, ALAPPUZHA. 2. AUTHORISED OFFICER & CHIEF MANAGER FEDERAL BANK LTD. , REGIONAL OFFICE, ALAPPUZHA. 3. CHARLES,S/O. P.T. CHERIAN PALATHARA FASHION JEWELLERS, A.S.ROAD, CHERTHALA. 4. P.K.VIJAYAKUMAR, ADVOCATE, C/O.ADV.P.ROY, ADVOCATE COMMISSIONER ALAPPUZHA. ADV. SRI.MOHAN JACOB GEORGE, SC, FEDERAL BANK FOR R1 & R2 SMT.P.V.PARVATHI SMT.REENA THOMAS SRI.L.RAM MOHAN SRI.A.KRISHNAN FOR R3 THIS WRIT PETITION (CIVIL) HAVING BEEN FINALLY HEARD ON 14/10/2008,THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: Kss WPC.NO.20332/2008 U APPENDIX PETITIONER'S EXHIBITS: EXT.P1: COPY OF NOTICE U/S.13 (2) DTD. 27/10/2005 OF THE 1ST RESPONDENT FOR RS.3,74,005. EXT.P2: COPY OF NOTICE U/S. 13(2) DTD. 27/10/2005 OF THE 1ST RESPONDENT FOR RS.13,57,854.50. EXT.P3: COPY OF POSSESSION NOTICE DTD. 2/11/2006. EXT.P4: COPY OF SALE NOTICE DTD. 7/05/2007. EXT.P5: COPY OF PETITION DTD. 22/04/08 FILED BY THE 2ND RESPONDENT. EXT.P6: COPY OF ORDER DTD. 22/04/08 PASSED IN C.M.P.NO. 1879/2008. RESPONDENT'S EXHIBITS: EXT.R1(A): COPY OF THE INTERIM ORDER DTD. 24/11/2006 IN WP(C) NO.31273/2006. EXT.R1(B): COPY OF THE SAID ORDER DTD. 2/03/2007 IN WP(C) NO. 31273/2006. EXT.R1(C): COPY OF THE ORDER DTD. 12/06/2007 IN SA 33/2007 PASSED BY THE DRT, ERNAKULAM. EXT.R1(D): COPY OF JUDGMENT DTD. 25/10/07 IN WP(C) NO.31708/2007. EXT.R1(E): IA.23/2008 IN W.A.2587/2007. THE SAME WAS ALSO DISMISSED VIDE ORDER DTD. 26/02/2008 BY THE DIVISION BENCH. COPY OF THE SAID ORDER DTD. 26/02/2008. /TRUE COPY/ P.S.TO JUDGE Kss THOTTATHIL B. RADHAKRISHNAN, J. = = = = = = = = = = = = = = = = = = = = = = = = W.P.(C).No.20332 of 2008-U = = = = = = = = = = = = = = = = = = = = = = = = Dated this the 14th day of October, 2008. JUDGMENT 1.With outstandings of Rs.17,31,859.50, two notices of demand were issued on 21-10-2005 calling upon the petitioners to wipe off the outstandings due to the first respondent bank. That was not honoured. Therefore, Section 13(4) notice was issued under the SARFAESI Act. On 7-5-2007, that sale notice was published. Petitioners filed proceedings before the DRT challenging that. Ext.R1(c) order was issued by the DRT granting petitioners time to vacate the premises after overruling their contentions. In doing so, the Tribunal had noticed that in spite of Exts.R1(a) and R1(b) orders of this Court granting petitioners opportunity to wipe off the outstandings in instalments, the amounts were not paid. Against Ext.R1(c) order of the DRT, petitioners filed a writ petition resulting in WP(C)20332/08 -: 2 :- Ext.R1(d) dismissing it. Writ appeal against that judgment was also dismissed, however granting the petitioners a further period of two months to vacate. By Ext.R1(e), the Division Bench rejected a further application of the petitioners for enlargement of time to vacate the premises, aptly stating that the said application is nothing but a tactic adopted by the petitioners to gain as much time as possible to settle their admitted liability to the financial institution and further stating that Their Lordships do not want to be parties to the tactics thus adopted by the petitioners. 2.This writ petition is filed seeking interference with further proceedings when action was taken under Section 14 of the SARFAESI Act, before the learned Magistrate. Incidentally, Ext.P4 notice dated 7-5-2007, which was the subject matter of Exts.R1(a) to R1(e) decisions, is also challenged. 3.Most importantly, it needs to be noticed that the WP(C)20332/08 -: 3 :- correctness or otherwise of Ext.P4 does not survive Exts.R1(a) to R1(e) decisions. Not only that, the only point that is urged before me is that in Ext.P4, though there are two items of properties, even the sale of the second item would have been sufficient because the reserve price fixed for that parcel is Rs.18.75 lakhs, whereas the total outstanding is only Rs.17,31,859.50. It is only Item No.1, with the reserve price of Rs.40 lakhs, which was sold in auction and bid by the third respondent whose learned counsel states that as regards Item NO.2, the State has certain preferential claims, including attachments for sales tax or other arrears. I need not go into that question. This is because, the amount of Rs.17,31,859.50 was the amount covered by the demand notices dated 27-10-2005. Three years have now gone through. A perusal of Exts.P1 and P2 would show that the rate of interest agreed was 16.75% per annum with monthly rests. Even applying that rate of interest of 16.75% as simple interest running on the total outstandings of WP(C)20332/08 -: 4 :- Rs.17,31,859.50, the interest accrued by this time would be more than Rs.8,70,000/-. The total outstandings, as of now, would thus be more than Rs.26 lakhs. The sale of Item No.1 alone, to satisfy the debt, cannot, therefore, be impeached on that ground. The sale was confirmed in favour of the third respondent for Rs.45 lakhs. It is stated that the petitioners had deposited an amount of Rs.2 lakhs in the meanwhile. Obviously, that amount will also be given due credit to when the bank adjusts its accounts and releases the remaining amount to the petitioners in accordance with law. I find no jurisdictional error or legal infirmity warranting interference with the impugned proceedings. Hence, subject to what is aforesaid regarding final adjustments, this writ petition is dismissed. THOTTATHIL B. RADHAKRISHNAN, JUDGE. Sha/151008