IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT : THE HONOURABLE MR. JUSTICE S.SIRI JAGAN THURSDAY, THE 24TH JULY 2008 / 2ND SRAVANA 1930 WP(C).No. 19966 of 2008(B) -------------------------- PETITIONER: ------------ PANDURANGA PAI.H., AGED 44 YEARS, S/O DEVDAS PAI, TEMPLE ROAD, KUMBLA,KASARGODE, PIN 671 321. BY ADV. SRI.SHOBY K.FRANCIS RESPONDENTS: ------------- 1. STATE BANK OF INDIA, KASARGODE BRANCH, BANK ROAD, KASARGODE, REPRESENTED BY ITS CHIEF MANAGER. 2. THE AUTHORIZED OFFICER, (UNDER SECURITISATION ACT) STATE BANK OF INDIA, KASARGODE BRANCH, BANK ROAD, KASARGODE, PIN 671 121. BY SRI.P.V.SURENDRANATH THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 24/07/2008, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: S.SIRI JAGAN, J. ================== W.P.(C).No.19966 of 2008 ================== Dated this the 24th day of July, 2008 J U D G M E N T The petitioner availed of a housing loan from the 1st respondent bank. The petitioner committed default in repayment. Therefore, the bank initiated proceedings under the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002, which is under challenge in this writ petition. The petitioner submits that this is only a housing loan and only because of the circumstances beyond the control of the petitioner that he was unable to pay some of the instalments of repayment of loan. He would submit that he is prepared to pay the entire defaulted loan amounts together with interest and costs and that he would pay future instalments on the due dates as per the original loan agreement without any further default and on that condition, the respondents may be directed to regularise the loan account and permit the petitioner to pay the balance instalments as per the loan agreement. 2. This is stoutly opposed by the standing counsel for the bank. He would submit that once the account is classified as NPA, thereafter, the account cannot be directed to be regularised. He w.p.c.19966/08 2 also submits that the petitioner being a defaulter, he cannot dictate terms and in so far as the bank has done everything legally in accordance with the provisions of the Act, this Court cannot interfere with the action taken by them. 3. I have considered the rival contentions in detail. 4. I am of opinion that the bank should not take such a rigid attitude especially on the face of a very harsh and unrelenting legislation. The loan in question is only a house building advance. The bank should show some more leniency in the matter in view of the extenuating circumstances instead of insisting on their pound of flesh. The fact that the account has been classified as a NPA, cannot stand in the way of giving such concession to deserving borrowers. In this case, default is only from 17.8.2006 onwards. In the peculiar facts and circumstances of the case, the respondents can make an exception in permitting the petitioner to regularise the loan account by permitting the petitioner to regularize loan account by paying the defaulted instalments with interest and the costs incurred by the bank in the course of the proceedings under the Act. Accordingly, this writ petition is disposed of as follows: w.p.c.19966/08 3 It is submitted that amount sufficient to cover the defaulted instalments has already been paid by the petitioner. The petitioner shall pay the balance amount, if any, to make up the defaulted instalments with interest and costs incurred by the bank in the proceedings under the Act, within two weeks from today after ascertaining the amount from the bank. Thereafter, the petitioner shall continue to pay the instalments of prepayment of loan as per the loan agreement on the due dates without default. If the petitioner complies with the above directions strictly, further proceedings under the Act shall be kept in abeyance. However, if the petitioner fails to pay the balance amount necessary to cover the defaulted instalments with interest and costs, or the petitioner commits default in payment of any one instalment as per the loan agreement, it would be open to the respondents to continue the proceedings as now initiated without having to issue no fresh notice or proceedings in that regard. Sd/- sdk+ S.SIRI JAGAN, JUDGE ///True copy/// P.A. to Judge w.p.c.19966/08 4