The petitioner availed cash credit facility of Rs. 21,00,000/- from the first respondent Bank, creating security interest over the property in question. By virtue of the default on the part of the petitioner, the Bank is proceeding with steps under the SARFAESI Act, which in turn is sought to be intercepted in this writ petition.
2. The learned Counsel for the petitioner submits that the default occurred was not because of any wilful laches or deliberate negligence, but because of some unforeseen circumstances. The learned counsel for the petitioner submits that the petitioner does not intend to dispute the liability or to avail the statutory remedy by approaching the DRT. It is however assured that the entire 'outstanding amount' will be cleared, without fail, if some breathing time is given.
3. The learned standing counsel for the respondent Bank submits, with reference to the statement filed, that the financial W.P.(C) No. 29815 of 2014 : 2 :
assistance extended to the petitioner was an overdraft facility and that the loan period was two years from 11.08.2011. It is stated that the petitioner has not submitted the relevant documents for renewal of the account. Paragraphs 3 and 4 of the statement are relevant, which read as follows :
“3. The overdraft facility was sanctioned for 2 years from 12.08.2011 to 11.08.2011 and after the expiry of the period, the petitioner has to submit the renewal documents for renewing the overdraft facility. The renewal documents are - Audited Financial Statements, Projections for the next two financial years, vat return copies etc. for analysing the financial strength, utilization of earlier sanctioned limit, remittance of tax etc. for taking decision to allow future operation of the account.
4. The petitioner did not submit the renewal papers and kept the overdraft within the prescribed limits. Of late, the petitioner brought the account within the prescribed limit but they have not submitted the renewal papers within 6 (sic) months of the expiry of the time limit i.e. 11.08.2013 or after two review periods of 3 months each thereafter. Thus, the overdraft account has become Non Performing Account (NPA) on 13.08.2013 as per RBI guideline.”
W.P.(C) No. 29815 of 2014 : 3 :
4. After hearing both the sides, this Court finds that the petitioner was enjoying the benefit of overdraft facility without effecting substantial payment but for effecting some paltry payment and without executing the proper documents for renewal of overdraft account, as insisted from the Bank. Considering the persuasive submission made by the learned counsel for the petitioner, this Court finds it fit and proper to permit the petitioner to clear the 'entire outstanding amount' by way of 'six' installments commencing from 30.12.2014, followed by similar installments to be effected on or before the last working day of the succeeding months. The recovery proceedings stated as being pursued against the petitioner shall be kept in abeyance for the time being. It is made clear that, if the petitioner commits any default in remitting the installments as above, the respondent Bank will be at liberty to proceed with further steps for realisation of the entire outstanding liability in a lump, pursuing such steps, from the stage where it stands now.
The writ petition is disposed of as above.
Sd/-
P. R. RAMACHANDRA MENON, (JUDGE) kmd