IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT : THE HONOURABLE MR. JUSTICE S.SIRI JAGAN WEDNESDAY, THE 13TH AUGUST 2008 / 22ND SRAVANA 1930 WP(C).No. 23433 of 2008(M) -------------------------- PETITIONER: ------------ 1. M/S.KARUNA STEELS & KAIWALYA BUILDING MATERIALS, REPRESENTED BY ITS MANGING PARTNER SRI.A.R.RAJEEV, SREEKARIYAM, THIRUVANANTHAPURAM. 2. A.R.RAJEEV, `GURUVARUL' ROSE NAGAR, SREEKARIYAM, THIRUVANANTHAPURAM-17. 3. SMT.C.BRINDA, `GURUVARUI' ROSE NAGAR, SREEKARIYAM, THIRUVANANTHAPURAM-17. BY ADV. SRI.ELVIN PETER P.J. RESPONDENTS: ------------- 1. PUNJAB NATIONAL BANK, REPRESENTED BY ITS CHARIMAN AND MANAGING DIRECTOR, 7, BHIKAJI CAMA PALACE, NEW DELHI-110 066. 2. THE CHIEF MANAGER, ASSET RECOVERY MANAGEMENT BRANCH, PUNJAB NATIONAL BANK, REGIONAL OFFICE, MARKET ROAD, ERNAKULAM-682 011. 3. THE AUTHORISED OFFICER FOR PUNJAB NATIONAL BANK, ASSET RECOVERY MANAGEMENT BRANCH, 3RD FLOOR, 40/1461, MARKET ROAD, ERNAKULAM-682 011. BY ADV. SRI.K.P.SUDHEER FOR R2 SRI.V.C.MADHAVANKUTTY FOR R2 THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 13/08/2008, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: S.SIRI JAGAN, J. ================== W.P.(C).No. 23433 of 2008 ================== Dated this the 13th day of August, 2008 J U D G M E N T The petitioners are defaulters in repayment of loan amounts due from them to the 2nd respondent bank. The respondents have initiated proceedings under the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002, for coercive recovery, which is under challenge in this writ petition. According to the petitioners, the bank had agreed for One Time Settlement of the loan account by accepting Rs.1.23 crores as full and final settlement of the loan account. The petitioners would submit that the petitioners have already paid Rs.106 lakhs out of Rs.123 lakhs. The balance is only Rs.17 lakhs, which the petitioners could not pay because of intervening circumstances of acquisition of some of their properties. The petitioners intended to sell properties belonging to them to pay the balance amount of Rs.17 lakhs part of which was acquired by the Government. The petitioners now submit that the petitioners are prepared to pay the balance amount of w.p.c.23433/08 2 Rs.17 lakhs with interest and all expenses incurred by the bank. The petitioners submit that they will pay Rs.17 lakhs within one month and the balance in another one month. 2. This is opposed by the standing counsel for the Bank. According to him, the petitioners were directed to pay the amounts as per the OTS Scheme on 22.3.2007. Instead they paid only Rs.18 lakhs on 2.1.2007 in the loan account, Rs.32 lakhs on 6.12.2007 in a third party account and another Rs.56 lakhs on 26.3.2008 in another third party account. The OTS facility has already been cancelled and therefore, the petitioners have to pay the entire amount as per the original demand, is the contention raised. 3. After hearing both sides, I feel that the petitioners can be permitted to pay the balance amount out of the OTS amount after adjusting the amount deposited in the third party accounts to the loan account. For this, the petitioners have no objection. Accordingly, this writ petition is disposed of as follows: The second respondent is directed to settle the account by accepting the amounts due as per the OTS offer made by them. However, the petitioners shall be liable to pay interest on all w.p.c.23433/08 3 delayed payments out of the OTS amount as also the charges and costs incurred by the bank for the recovery proceedings. Accordingly, the petitioners shall pay an amount of Rs.17 lakhs within one month from today. The balance amount as directed above, which shall include the interest on the delayed payments and the charges and costs incurred for the recovery proceedings, shall be paid within another month. I also make it clear that for this purpose, the deposit in the third party account shall be treated as payment to the loan account. If the petitioners pay the amounts as directed above in time, coercive proceedings shall be kept in abeyance. However, if the petitioners fail to comply with the above directions, it would be open to the respondents to continue the proceedings as now initiated without having to issue any fresh notice or proceedings in that regard. Sd/- sdk+ S.SIRI JAGAN, JUDGE ///True copy/// P.A. to Judge w.p.c.23433/08 4