IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT : THE HONOURABLE MR. JUSTICE C.K.ABDUL REHIM WEDNESDAY, THE 15TH JUNE 2011 / 25TH JYAISHTA 1933 WP(C).No. 14138 of 2011(N) --------------------------------- PETITIONER(S): ------------------- 1. M.V. MAHAMOOD, RESIDING AT HOUSE NO.37/1094D, STERLING ESTATE, KUMARANASAN ROAD, ERNAKULAM -682 017. 2. RAMEESA MAHAMOOD OF -DO- -DO- BY ADVS. SRI.JOHNSON MANAYANI SRI.BENHUR JOSEPH MANAYANI RESPONDENT(S): --------------------- 1. CHIEF MANAGER (AUTHORISED OFFICER UNDER SARFAESI ACT) ASSET RECOVERY CELL, FEDERAL TOWERS, FIRST FLOOR, MARINE DRIVE, ERNAKULAM, KOCHI -31. 2. FEDERAL BANK LTD., HEAD OFFICE AT ALUVA.P.O,683 101 REPRESENTED BY ITS CHAIRMAN. 3. GENERAL MANAGER, FEDERAL BANK LTD., HEAD OFFICE, FEDERAL TOWERS, ALUVA.P.O.683 101 4. GENERAL MANAGER (RECOVERY SALE) OF FEDERAL BANK LTD. HEAD OFFICE, ALUVA - 683 101. 5. APPLE A DAY PROPERTIES (PRIVATE) LIMITED APPLE TOWER,PALARIVATTOM, COCHIN -25, REPRESENTED BY ITS MANAGING DIRECTOR. R-1 BY ADVS. SRI.A.ANTONY SMT.LEELAMMA ANTONY THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 15/06/2011, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: svs W.P.(C). NO. 14138/2011 APPENDIX PETITIONER'S EXHIBITS: P1: COPY OF THE REGISTRATION AND PAYMENT. P2: COPY OF THE RECEIPT FOR PAYMENT OF RS.1,14,500. P3: COPY OF THE BALANCE PAYMENT CONFIRMATION. P4: COPY OF THE PAPER PUBLICATION MADE BY THE FIRST RESPONDENT DATED 12/05/2011. P5: COPY OF THE PETITION FILED BY THE PETITIONERS BEFORE RESPONDENTS 2 TO 4 DATED 18/05/2011. RESPONDENT'S EXHIBITS: NIL /TRUE COPY/ P.A. TO JUDGE. svs C.K.ABDUL REHIM, J. ------------------------------------------- W.P.(C).No.14138 of 2011 ------------------------------------------- Dated this the 15th day of June, 2011 J U D G M E N T ---------------------- Consequent to default committed by the petitioners in repaying a housing loan availed from respondents 1 to 4, proceedings under the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (SARFAESI Act) was initiated and the residential apartment, which is the secured asset, was already taken over possession invoking Section 13(4). Through Ext.P4, the property has now been proclaimed for sale. According to the petitioners, the coercive steps were pursued without acceding to their request for permitting regularisation of the account, on the basis of offer made for payment of the amounts overdue within a short period. Counsel appearing for respondents 1 and 2 submitted that the loan in question was availed in the year 2007 to the tune of Rs.15 lakhs and after availing the loan the petitioners had defaulted consecutive monthly instalments. The total amount outstanding in the loan account as on today is more than Rs.18 lakhs. It is submitted that even the amount overdue for payment (defaulted instalments and other charges) will come to around Rs.4.56 lakhs. Since the loan account is in chronic default and since the W.P.(C).14138/2011 -2- property has already been taken over possession, the the respondent Bank is not favouring in permitting regularisation of the account. 2. Considering availability of the effective remedy under the statute, which the petitioners had failed to invoke, it may not be justified on the part of this court to interfere with the proceedings. However, learned counsel for petitioners made an undertaking that they are not intending to invoke any statutory remedy and that the petitioners are relinquishing all challenges raised against the proceedings. On the other hand, a limited relief is sought for to permit regularisation of the account by effecting payment of the amounts in default within a short period. 3. Even though interference on merits is not warranted, I am of the view that the petitioners can be permitted to regularise the account, in view of the relinquishments made and also in view of the fact that the period of repayment is for 15 years from the year 2005. 4. Under the above mentioned circumstances the writ petition is disposed of directing the respondents 1 to 4 to keep in abeyance confirmation of sale if any takes place on the basis of Ext.P4 proclamation, subject to condition of the petitioners remitting the entire amounts in default (defaulted monthly W.P.(C).14138/2011 -3- instalments along with interest and expenses if any due) in 2 (two) equal monthly instalments falling due on or before 15.7.2011 and 15.8.2011 along with payment of the regular monthly instalments due for the respective months. 5. If the amount in default is cleared payment by the petitioners as directed above, the respondents 1 to 4 shall permit the petitioners to make payment of the future monthly instalments in accordance with the original schedule of repayment. If amounts in default is cleared payment, then the respondents 1 to 4 shall cancel sale if any takes place on the basis of Ext.P4. In such case, respondents 1 to 4 shall permit re- occupation of the residential apartment by the petitioners, without prejudice to legal possession being retained by respondents 1 to 4 on the basis of the steps already taken under the SARFAESI Act. 6. It is made clear that on the event of default in effecting payment of any of the amounts as stipulated above, or any one of the future monthly instalments, the respondents will be free to proceed with confirmation of sale if any takes place or to proceed with further steps for conducting fresh sale. If any future monthly instalment is defaulted payment by the petitioners, the respondents will be free to dispossess occupation of the apartment in question and to proceed with further steps, W.P.(C).14138/2011 -4- without recourse to any legal proceedings. 7. It is made clear that on the event of any such eventualities, the petitioners will be precluded from raising any subsequent challenges against the same. C.K.ABDUL REHIM, JUDGE. okb