IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT : THE HONOURABLE MR. JUSTICE ANTONY DOMINIC THURSDAY, THE 1ST OCTOBER 2009 / 9TH ASWINA 1931 WP(C).No. 1621 of 2007(R) ------------------------------------- PETITIONER: ------------------- HYMAVATHESWARY AMMA, T.C. 10/1369-1, VATTIYOORKAVU, THIRUVANANTHAPURAM. BY ADVS. MR.P.RAMAKRISHNAN, MR.T.C.KRISHNA. RESPONDENTS: ------------------------ 1. UNION OF INDIA, REPRESENTED BY PRINCIPAL SECRETARY TO GOVERNMENT, MINISTRY OF COMMERCE, BANKING DIVISION, NEW DELHI. 2. M/S.PUNJAB AND SIND BANK, M.G.ROAD, THIRUVANANTHAPURAM, REPRESENTED BY AUTHORISED OFFICER, ZONAL OFFICE, CHENNAI-2. 3. B.RAJASEKHARAN NAIR, GOVERNMENT CONTRACTOR, DEVI BHAVAN, PALLICHAL P.O. NEMOM, THIRUVANANTHAPURAM-20. 4. K.MOHANACHANDRAN NAIR, T.C.10/1369-1, VATTIYOORKAVU, THIRUVANANTHAPURAM. 5. PREMALATHA P.M., T.C. 10/1369-1, VATTIYOORKAVU, THIRUVANANTHAPURAM. 6. K.HEMACHANDRAN NAIR, T.C.10/1369-1, VATTIYOORKAVU, THIRUVANANTHAPURAM. W.P.(C). NO.1621/2007-R: 7. DEVI R.NAIR ALIAS DEVAKI, W/O.B.RAJASEKHARAN NAIR, DEVI BHAVAN, PALLICHAL P.O., NEMOM, THIRUVANANTHAPURAM. R1 BY MR. AJITH PRAKASH, C.G.C, R2 BY ADVS. MR.C.G.SUNIL, MR.SAJI MATHEW. THIS WRIT PETITION (CIVIL) HAVING BEEN FINALLY HEARD ON 01/10/2009, ALONG WITH W.P.(C). NO. 2054/2007 & CONNECTED CASES, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: W.P.(C). NO.1621/2007-R: APPENDIX PETITIONERS' EXHIBITS: EXT.P.1: COPY OF THE NOTICE UNDER SECTION 13 (2) OF THE SARFAESI ACT DTD. 23/11/2004 ISSUED BY THE R.2. TO THE PETITIONER. EXT.P.2: COPY OF THE POSSESSION NOTICE ISSUED BY THE R.2. UNDER SECTION 13 (4) OF THE SARFAESIM ACT DTD. 22/12/2006. EXT.P.3: COPY OF THE TENDER/AUCTION NOTICE PUBLISHED BY THE R.2. IN THE MATHRUBHOOMI DAILY DTD. 29/12/2006. EXT.P.4: COPY OF THE REPRESENTATION SUBMITTED BY THE PETITIONER BEFORE THE R.2. DTD. 02/01/2007. EXT.P.5: COPY OF THE REPRESENTATION SUBMITTED BY THE PETITIONER BEFORE THE R.1. DTD. 02/01/2007. EXT.P.6: COPY OF THE STATEMENT OF ACCOUNTS PRODUCED BY THE BANK BEFORE THE D.R.T. EXT.P.7: COPY OF THE LETTER FROM THE R.3. TO THE R.2. BANK DTD. 15/09/2001. RESPONDENTS' EXHIBITS: NIL. //TRUE COPY// P.A. TO JUDGE. Prv. ANTONY DOMINIC, J. ------------------ WP(C) Nos.1621, 2054, 2619 of 2007 & 23584 of 2008 -------------------------- Dated, this the 1st day of October, 2009 J U D G M E N T First I shall deal with WP(C) Nos.1621 and 2054 of 2007. 2. These writ petitions are filed by guarantors of a loan availed of by the 3rd respondent from the 2nd respondent Bank in these writ petitions. The petitioners and respondents 4 to 7 in these cases are the guarantors. Default was committed and the Bank initiated O.A.No.225/2004 before the Debt Recovery Tribunal. During the pendency of the proceedings, proceedings were also initiated under the provisions of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002. Finally, by notice dated 28/12/2006, auction notice under the Act was published by the Bank proposing to auction the properties of the guarantors for realising an amount of Rs.17,50,195/- (Rupees seventeen lakhs fifty thousand one hundred and ninety five only). It was at that stage, these writ petitions were filed. WP(C) Nos.1621, 2054, 2619 of 2007 & 23584 of 2008 -2- 3. By order dated 15/01/2007, passed in WP(C) No.1621/2007, this Court granted stay of further proceedings on the petitioner remitting an amount of Rs.10,00,000/- (Rupees ten lakhs only). In view of the above order, no separate order was passed in WP(C) No.2054/2007. The petitioners in these cases submit, and the Bank also confirms, that the said order has been complied with. 4. It is stated that subsequently, the Debt Recovery Tribunal passed final order in O.A.No.225/2004 enabling the Bank to realise its dues, but, however, without taking into account the amount paid by the petitioners herein, in compliance with the order dated 15/01/2007 passed by this Court referred to above. It is stated that thereupon the petitioners herein filed applications for review of the order passed by the Debt Recovery Tribunal in O.A.No.225/2004, and that the matter is pending. 5. At present, the request made by the petitioners is that since the Bank has already initiated sales proceedings against the property of the 7th respondent, one of the guarantors, who is none other than the wife of the 3rd respondent, the principal debtor, the WP(C) Nos.1621, 2054, 2619 of 2007 & 23584 of 2008 -3- Bank should continue and complete the proceedings against the property of the 7th respondent first, and that the petitioners herein should be proceeded against only after completing such proceedings. It is also stated that the petitioners had approached the Bank for the benefit of One Time Settlement Scheme floated by the Bank, and that without any reason, the said request was rejected. It was submitted by the petitioners that they have again moved for the benefit of the Scheme with another request and that the same is also pending. 6. As far as the prayer of the petitioners that the Bank should be directed to complete the proceedings against the property of the 7th respondent is concerned, though, the 7th respondent happens to be the wife of the 3rd respondent, the principal debtor, as far as she is concerned, her liability is that of a guarantor, and therefore, she does not stand on any disadvantageous position, as compared to the petitioners. As a creditor, the Bank is entitled to proceed against any of the defaulters either jointly or separately. If that be so, one of the guarantors cannot be heard to say that the Bank should proceed WP(C) Nos.1621, 2054, 2619 of 2007 & 23584 of 2008 -4- against only one among them and that he should be proceeded only thereafter. Therefore, I am not prepared to think that the Bank should complete the proceedings against the 7th respondent and that until then, should keep in abeyance further proceedings against the petitioners or any other guarantors. 7. In so far as the request for OTS Scheme is concerned, the petitioners pointed out that although the first request made by them was rejected, they made yet another request, which is pending. Although, the learned counsel for the Bank points out that the Bank has no such Scheme now in force, still having regard to the fact that the petitioners had already made Rs.10,00,000/- (Rupees ten lakhs only) in compliance with interim order dated 15/01/2007, it is only appropriate that the petitioners should be given yet another opportunity to move the Bank seeking concessions. Accordingly, it is directed that it will be open to the petitioners to approach the 2nd respondent Bank requesting for concessions in the matter. It is directed that if such a request is made, the same shall be considered and orders thereon shall be passed as expeditiously as possible within four weeks thereafter. It is directed that in the WP(C) Nos.1621, 2054, 2619 of 2007 & 23584 of 2008 -5- meanwhile further proceedings initiated against the petitioners in pursuance to auction notice dated 28/12/2006, shall be kept in abeyance. 8. In so far as the petitioner in WP(C) Nos.2619 of 2007 & 23584 of 2008 are concerned, she is the purchaser of the property of the petitioner in WP(C) No.1621/2007, which was already mortgaged to the respondent Bank. The petitioner challenges the proceedings and requests that the property purchased by her be absolved from further proceedings. Having regard to the fact that the property in question was already a mortgaged property, the seller could not have sold the same. In any case, the property purchased by the petitioner was already encumbered in favour of the Bank and hence there is no merit is the plea. Therefore, the petitioner cannot seek any relief against the Bank as sought for, and I am not inclined to pass any order as sought for in these two writ petitions. These writ petitions are disposed of as above. (ANTONY DOMINIC, JUDGE) jg