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Justice Raja Vijayaraghavan V. of the Kerala HC refused a writ petition based on the provisions of Article 226 of the Constitution of India.
In the present case, the petitioner is the accused in a suit initiated under the Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002. The respondent, co-Operative Urban Bank Ltd (Respondent 1) gave a loan to the petitioner which he defaulted in re-payment. The Respondent thus sued him under the SURFAESI Act. The Act allows the creditor to take over the securities submitted by the debtor without any intervention of the Court. The Bank in this case can also employ a Reconstruction Company to acquire the debtor’s financial assets in any institution.
The counsel for the petitioner prayed that the default in the repayment of the loan was due to exterior factors outside the periphery of control of the petitioner. The petitioner prayed for some more extra time to regularize his account in the bank.
The respondents contented that the only interest of the bank is to realize the arrears that amount to a Rs. 9,23,000.
The HC through the cases Union Bank of India v. Stayawati Tandon, (2010) 8 SCC 110 and State Bank of Travancore v. Mathew K.C., 2018 (1) KLT 784 reminded that the SURFAESI Act under Section 17 provided effective relief and the right to appeal. The invoking of Article 226 was thus unnecessary. The HC said that this is the final time that the HC would indulge in the matter. The HC directed the petitioner to pay the sum in 10 easy installments, starting from 15/01/2020. The payment was to be made without any delay. In case of a default, all benefits granted by the Court would stand vacated and the Bank could take the steps according to the provisions of the SURFAESI Act.
Abdul Salam v. The General Manager, Co-operative Urban Bank Ltd., WP (C) No.35875 of 2019
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