IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT : THE HONOURABLE MR. JUSTICE C.K.ABDUL REHIM WEDNESDAY, THE 7TH OCTOBER 2009 / 15TH ASWINA 1931 WP(C).No. 26705 of 2009(G) -------------------------- PETITIONER(S): --------------- K.N.RAVINDRAN, AGED 49 YEARS S/O.NARAYANAN, RESIDING AT KALLATTUPARAMBIL HOUSE KOZHUKULLI PO, MOORKKANIKKARA, THRISSUR DISTRICT BY ADVs. SRI.P.G.SURESH SRI.C.V.MANUVILSAN SMT.K.VIDYA SRI.M.R.VIBIN RESPONDENT(S): --------------- 1. THE DISTRICT MAGISTRATE & DISTRICT COLLECTOR, DISTRICT COLLECTORATE, THRISSUR. 2. THE UNION BANK OF INDIA REPRESENTED BY ITS CHIEF MANAGER & AUTHORISED OFFICER, THRISSUR BRANCH, SAKTHAN ARCADE, THRISSUR. 3. STATE OF KERALA REPRESENTED BY THE SECRETARY, DEPT. OF HOME AFFAIRS, THROUGH THE PUOBLIC PROSECUTOR, HIGH COURT OF KERALA. R1 & R3 BY SENIOR GOVT. PLEADER SRI. A.J. VARGHESE R2 BY STANDING COUNSEL SRI. A.S.P. KURUP THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 07/10/2009, ALONG WITH WP(C) NO. 18336 OF 2009, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: shg/ C.K. ABDUL REHIM, J. - - - - - - - - - - - - - - - - - - - - - - - W.P.(C)No. 26705 of 2009 & W.P.(C) No.18336 of 2009 - - - - - - - - - - - - - - - - - - - - - - - Dated this the 7th day of October, 2009 J U D G M E N T 1. The Writ Petition No.26705/2009 is filed by the borrower of the loan, challenging the proceedings initiated by the 2nd respondent Bank under the Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (SARFAESI Act). According to him he had availed a housing loan from the bank to the tune of Rs.10,00,000/- and he was promptly repaying the loan amounts. But during the year 2004-05 there arose a criminal investigation against the then Senior Manager of the 2nd respondent Bank who allegedly entered into a criminal conspiracy and disbursed huge amounts to various customers without being satisfied about any genuine purposes and without properly securing the loan amounts. W.P.(C)No. 26705 of 2009 & W.P.(C) No.18336 of 2009 -2- It is admitted that the petitioner is also an accused in the said case. The Central Bureau of Investigation (CBI) has conducted investigation of the case and a final report has already been submitted before the Special Judge (CBI) Court, Ernakulam. 2. Allegation of the petitioner in W.P.(C) No.26705/2009 is that after initiation of the criminal investigation, the 2nd respondent Bank was not accepting any repayments in the loan account, for the reason that the entire records pertaining to the loan transaction was taken into the custody by the CBI. However having faced with proceedings under the SARFAESI Act the petitioner submitted before the Bank that he is ready to regularize the loan account by remitting the defaulted installments. But the Bank is not prepared for permitting regularization in view of the circumstances stated above. At present the Bank had approached the District Magistrate under the provision of Section 14 (1) of the SARFAESI Act and the Tahsildar W.P.(C)No. 26705 of 2009 & W.P.(C) No.18336 of 2009 -3- was directed to take possession of the immovable property which is the secured asset. 3. Writ Petition No.18336/09 is field by the 2nd respondent Bank in W.P.(C) No. 26705/09. The allegation is that inspite of proceedings issued by the District Magistrate for taking over possession of the secured assets, the Tahsildar as well as the police authorities are not rendering adequate protection and help for executing the order. Therefore direction is sought for against the respondents therein to take effective action for execution of the order issued by the District Magistrate. 4. Learned standing counsel appearing for the respondent Bank on instruction submitted that the loan availed by the petitioner is in chronic default and an amount of Rs.10,82,052/- is outstanding as on 31.05.2006, along with future interest. It is further submitted that after availing the housing loan, the petitioner had not constructed any house utilizing the loan account. W.P.(C)No. 26705 of 2009 & W.P.(C) No.18336 of 2009 -4- 5. Under the given facts and circumstances it is evident that the request for regularization of the loan account by payment of the defaulted installments could not be allowed, because of the fact that the petitioner has totally misused the loan without constructing the residential building and the loanee as well as the officers of the Bank were already been implicated in the criminal case which is pending trial. 6. Learned counsel appearing for the petitioner expressed his willingness to pay off the entire liability in installments within a reasonable time. Eventhough learned standing counsel appearing for the Bank opposed such proposal, I am inclined to show some indulgence to pay off the entire liability in installments, within a reasonable time. 7. Accordingly the petitioner is directed to make payment of the amount of Rs.3,00,000/- on or before 10.11.2009. The respondent Bank is directed to keep in abeyance further proceedings till such date. On payment of W.P.(C)No. 26705 of 2009 & W.P.(C) No.18336 of 2009 -5- the said amount the respondent Bank will furnish a balance statement to the petitioner after crediting all such payments showing the entire outstanding. The petitioner shall continue to pay the balance amount due as per the statement, in five (5) equal monthly installments starting from 10.12.2009 and on or before the 10th day of every succeeding month. 8. It is made clear that on the event of default in payment of any amount as stipulated, the respondent Bank is free to proceed with further steps pursuant to the order already issued by the District Magistrate and on such case the respondents 2 & 3 in Writ Petition No.18336/09, shall afford adequate police protection for executing the order. It is made clear that on any such event the petitioner will be precluded from raising any further challenge against the proceeding initiated under the SARFAESI Act, before this court or before any other forum. It is further made clear that the indulgence shown as above for payment of the W.P.(C)No. 26705 of 2009 & W.P.(C) No.18336 of 2009 -6- arrears will not in any way prejudice any proceedings or trial of the criminal cases already initiated. C.K. ABDUL REHIM JUDGE shg/