IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT : THE HONOURABLE THE CHIEF JUSTICE MR.H.L.DATTU & THE HONOURABLE MR. JUSTICE A.K.BASHEER MONDAY, THE 11TH AUGUST 2008 / 20TH SRAVANA 1930 W.A.No. 1670 of 2008 -------------- --------------------- AGAINST THE JUDGEMENT IN WPC.20617/2008 DATED 25/07/2008 .................... APPELLANT/PETITIONER: ------------------------------------- SANTHOSH G.S, NEW TRADE LINKS, 'PAVITHRAM' VALIYASALA, THIRUVANANTHAPURAM - 695 036 BY ADV. SRI.N.NANDAKUMARA MENON (SR.) SRI.P.K.MANOJKUMAR SMT.SUSHYA RAJAN RESPONDENTS/RESPONDENTS: ----------------------------------------------- 1. THE PUNJAB NATIONAL BANK HOUSING FINANCE LIMITED, 9TH FLOOR ANTRIKSH BHAWAN, 22, KASTURBA GANDHI MARG, NEW DELHI-110001 2. THE AUTHORISED OFFICER, P.N.B.HOUSING FINANCE LIMITED, BRANCH OFFICE 4TH FLOOR, CAPITAL TOWERS, STATUE JUNCTION, THIRUVANANTHAPURAM - 695 001 3. PUNJAB NATIONAL BANK HOUSING FINANCE LIMITED, CAPITAL TOWERS, STATUE JUNCTION, THIRUVANANTHAPURAM - 695 001 REPRESENTED BY ITS MANAGER. BY ADV. SRI.MADHU RADHAKRISHNAN THIS WRIT APPEAL HAVING COME UP FOR ADMISSION ON 11/08/2008, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: H.L.DATTU, C.J. & A.K.BASHEER, J. ------------------------------------------- W.A.No.1670 of 2008 ------------------------------------------ Dated, this the 11th day of August, 2008 JUDGMENT H.L.Dattu, C.J. The appellant calls in question the correctness or otherwise of the orders passed by the learned Single Judge in W.P.(C) No.20617 of 2008 dated 25th July, 2008. 2. In the writ petition filed, the petitioner had called in question Exts.P6 and P9 orders passed by the respondent Bank in exercise of their powers under the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 ('the Securitisation Act' for short). 3. The learned Single Judge has rejected the writ petition. That is how the petitioner is before us in this writ appeal. 4. Sri.N.Nandakumara Menon, learned senior counsel appearing for the appellant, would submit that the respondent Bank without considering the replies/explanation offered by the petitioner, immediately after receipt of Section 13(2) notice issued by the respondent Bank (Ext.P6), has passed Ext. P9 order and this, according to the learned senior counsel is contrary to the statutory provisions, as well as contrary to the observations made by the Apex Court W.A.No.1670 of 2008 2 in Mardia Chemicals Ltd. vs. Union of India, (2004) 4 SCC 311. 5. The Apex Court in the aforesaid decision has categorically stated the steps that are required to be taken by a financial institution under the provisions of the Securitisation Act. The Apex Court has made it clear that the Bank is at liberty to take proceedings under the provisions of the Securitisation Act to recover the amounts due from the defaulter. The Apex Court has further observed that the first step being notice under Section 13(2), requires to be issued by the financial institution to the defaulter, inter alia, directing him to show cause why the proceedings under Section 13(4) of the Securitisation Act should not be initiated and completed. 6. In the instant case, as we have already noticed, immediately after the receipt of Section 13(2) notice, the petitioner has filed his reply (Ext.P7). This reply ought to have been considered by the respondent Bank before issuing any notice/order under Section 13(4) of the Securitisation Act. Since that has not been done, in our opinion, Ext.P9 order is contrary to the statutory provisions as well as the observations made by the Apex Court. Therefore, it is difficult for us to sustain Ext.P9 order passed by the respondent Bank. W.A.No.1670 of 2008 3 7. In that view of the matter, we pass the following: ORDER i) Writ appeal is disposed of. ii) A direction is issued to the respondent Bank to consider Ext.P7 reply filed by the appellant to the notice issued under Section 13(2) of the Securitisation Act and then pass appropriate orders in accordance with law and in the light of the observations made by us in the course of our order. 8. With these observations and directions the writ appeal is disposed of. Ordered accordingly. (H.L.DATTU) CHIEF JUSTICE (A.K.BASHEER) JUDGE vns/dk