IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT : THE HONOURABLE MR. JUSTICE C.K.ABDUL REHIM TUESDAY, THE 19TH OCTOBER 2010 / 27TH ASWINA 1932 WP(C).No. 19544 of 2010(P) ------------------------- PETITIONER : ----------------- MRS.BENAZEER JAMAL, THANIPEEDIKAYIL HOUSE, NEAR B.H.S.SCHOOL, KODUNGALLUR-680664. BY ADV. SRI.M.A.SHIHAB RESPONDENT(S): ------------------------- 1. AUTHORISED OFFICER, BANK OF INDIA KERALA ZONE, KALOOR TOWERS, KALOOR-KADAVANTHRA ROAD, KOCHIN-17. 2. BRANCH MANAGER, BANK OF INDIA, WILLINGTON ISLAND BRANCH, KOCHI. R1 BY ADVS. SRI.DEVAN RAMACHANDRAN SRI.K.M.ANEESH THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 19/10/2010, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: Mn C.K.ABDUL REHIM, J. ------------------------------------------- W.P.(C).No.19544 of 2010 ------------------------------------------- Dated this the 19th day of October, 2010 J U D G M E N T ---------------------- The petitioner as well as her husband, who was employed abroad had availed two Housing Loans from the respondent Bank. Distinct items of immovable properties were mortgaged in order to secure the loans. Ext.P1 & P3 are the title deeds pertaining to those properties. Consequent to default committed in repayment of regular monthly installments, the loan accounts were classified as 'NPA' and the respondents had initiated proceedings under the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (SARFAESI Act). 2. It is the specific case of the petitioner that she made approach before the respondents seeking settlement of one of the loan accounts and for return of the title deed (Ext.P1) which is pledged as security for the said loan. Ext.P4 & P4(a) are the requests submitted in this regard. But without taking note of such requests, the proceedings W.P.(C).19544/10-P -2- under the SARFAESI Act was pursued and Ext.P5 notice was issued under Section 13(2). Under the above circumstances the petitioner seeks direction for considering 'One Time Settlement' and to permit her to pay off the liability in the first loan account and also for a direction to release Ext.P1 sale deed. 3. In a statement filed on behalf of respondents 1 and 2 it is mentioned that the petitioner along with her husband had availed two “Star Home Loans” to the extent of Rs.9,50,000/- and Rs.30 lakhs respectively. It is further submitted that apart from the housing loans, a vehicle loan to the tune of Rs.4,01,650/- was availed by the petitioner along with her husband. It is further stated that, as far as the housing loans are concerned amounts of Rs.10,21,895/- and Rs.33,36,632/- respectively is the outstanding balance. It is further stated that the request for 'One Time Settlement' had already been rejected by the respondents since the offer made by the petitioner is too low, and it was intimated to the petitioner through letter dt.25.6.2010. It is further submitted that a total sum of Rs.47,60,142/- is due in all the 3 loan accounts. 4. When the matter came up for consideration on 3.8.2010, learned counsel for the petitioner submitted that the W.P.(C).19544/10-P -3- petitioner is ready and willing to clear the entire outstanding amounts under the first housing loan account, by depositing an amount of Rs.10,21,895/- (the amount mentioned in the statement filed on behalf of the respondents). This court directed remittance of such amount within a period of 10 days in order to prove bonafides of the claim of the petitioner. It is mentioned that the condition has already been complied with. 5. The SARFAESI proceedings was initiated with respect to 2 housing loans. Going by the statement a sum of Rs.33,36,632/- is due under the second loan account. The petitioner is seeking direction to the respondent to release the first item of property covered under Ext.P1 sale deed upon which mortgage was created with respect to the loan account which was cleared payment. But the respondent opposes the prayer on the ground that huge amounts are due with respect to the other housing loan. It is contended that the respondents have got a lien on the property covered under Ext.P1 because there are arrears pending from the very same borrowers in other transactions. Eventhough various grounds were urged by the learned counsel for the petitioner to contend that the Bank is not legally entitled to hold the documents, I am not intending to W.P.(C).19544/10-P -4- adjudicate such contentions, considering the fact that the proceedings is only at the stage of issuing notice under Section 13(2) and that the petitioner has got effective remedy under the SARFAESI Act, as provided under Section 17(1). 6. Having confronted with the above situation, learned counsel for the petitioner sought for an alternate relief, to permit her to make payment of the defaulted amount outstanding in the second “Star Home Loan Account” within a reasonable time in installments. Learned counsel for the respondent Bank, on the basis of instructions, submitted that the outstanding arrears of that loan will come to more than Rs.5 lakhs. 7. Eventhough I am not inclined to entertain the writ petition on merits, and to adjudicate upon the question regarding liability of the petitioner and also on the question regarding right of the petitioner to get the title deed returned, I am of the view that indulgence can be shown in permitting the petitioner to regularise the account by payment of the outstanding arrears. This is especially because of the fact that the petitioner had expressed willingness to pay off such liability on relinquishing challenges against the proceedings initiated under the SARFAESI Act. W.P.(C).19544/10-P -5- 8. Under the above circumstances, the writ petition is disposed of directing the respondents to keep in abeyance further coercive steps of recovery pursuant to Ext.P5 notice, provided the petitioner remits the entire amount in default in the second loan account (defaulted monthly installments along with interest and expenses if any due) in 5 (five) equal monthly installments falling due on or before 15.11.2010 and on or before the 15th day of the succeeding months. The petitioner shall also make payment of the regular monthly installments due with respect to the above said months, along with payments as directed above. 9. If payment of the defaulted amounts is regularised in the second Star House Loan Account as directed above, the respondents will permit the petitioner to continue payment of monthly installments in future in accordance with the original schedule of repayment. It is further directed that if payment in the second loan account is regularised as directed above, the respondent Bank shall release the mortgage with respect to the property covered under Ext.P1 and shall return Title Deed and other documents of the property. 10. It is made clear that the directions contained in this W.P.(C).19544/10-P -6- judgment will not operate in any manner with respect to the vehicle loan, which is availed by the petitioner and her husband and that the respondents will be free to proceed with steps permissible under law, in case of default in payment of amounts due thereunder. 11. It is also made clear that on the event of default in payment of any of the installments as stipulated above, the respondents will be free to proceed with further steps and in such case the petitioner will be precluded from raising any subsequent challenge against such proceedings. C.K.ABDUL REHIM, JUDGE. okb