Telangana High Court
WP/24623/2004 of A.B. Kesari Kumar, Vs The Indian Overseas Bank, on 31 December 2004
HIGH COURT OF JUDICATURE, ANDHRA PRADESH AT HYDERABAD (Special Original Jurisdiction) FRIDAY, THE THIRTY FIRST DAY OF DECEMBER TWO THOUSAND AND FOUR PRESENT THE HON'BLE SRI JUSTICE N.V. RAMANA WRIT PETITION NO.24623 of 2004 Between: A.B. Kesari Kumar, S/o. A.B. Bhaktavatsalam, R/o. Samajam Street,
IN THE HIGH COURT OF JUDICATURE, ANDHRA PRADESH AT HYDERABAD
(Special Original Jurisdiction)
FRIDAY, THE THIRTY FIRST DAY OF DECEMBERTWO THOUSAND AND FOUR
PRESENT
THE HON'BLE SRI JUSTICE N.V. RAMANA
WRIT PETITION NO.24623 of 2004
Between:
A.B. Kesari Kumar, S/o. A.B. Bhaktavatsalam,R/o. Samajam Street, tiruchanur, Tirupathi Rural Mandal, Chittoor District.
..... PETITIONER
AND
The Indian Overseas Bank, 630, V.V. Mahal Road, Tirupathi, Chittoor District, Rep. by its Authorised Officer.
.....RESPONDENT
Petition under Article 226 of the Constitution of India praying that in thecircumstances stated in the affidavit filed herein the High Court may be pleased toissue a Writ, Order or direction, more particularly one in the nature of Writ ofMandamus, declaring the auction sale notice dated 9-12-2004 issued by theRespondent as arbitrary, unjust, discriminatory and illegal and consequently setaside the same and direct the Respondent to consider and grant reasonable timepreferably six months period to the Petitioner to enable him to pay the loan amountof Sri R. Venugopal (Borrower) and with all other consequential benefits, monetaryand otherwise.
Counsel for the Petitioner: MR.V.JAGAPATHI
Counsel for the Respondent: ---
The Court, at the admission stage, made the following:
THE HON’BLE SRI JUSTICE N.V. RAMANA
W.P. No. 24623 of 2004
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O r d e r:
Assailing the Auction Sale Notice dated 09-12-2004, issued by the respondent,proposing to auction the house property of the petitioner, the present writ petition isfiled.
It appears that in the year 2002, the respondent sanctioned loan amount ofRs.3,00,000/- to M/s. Balaji Metals, represented by one Sri. R. Venugopal, to whomthe petitioner stood as surety by mortgaging his house property, though he contendsthat he signed the papers without knowing that the papers would be used for suretypurpose. It appears that the said Sri. R. Venugopal did not repay the loan amountowing to his sustaining losses in his business. In those circumstances, therespondent issued Demand Notice dated 18-3-2004 to the loanee under Section13(2) of the Securitization and Reconstruction of Financial Assets and Enforcementof Security Interest Act, 2002 (for short ‘the Act’) demanding him to pay an amount ofRs.3,66,004/-, due and payable by him as on 29-02-2004, within sixty days.
The petitioner states that on coming to know of the Demand Notice, he submittedrepresentation dated 28-6-2004 to the respondent requesting to grant him at least sixmonths time to repay the amount on behalf of the loanee, but the respondentdeclined to grant the same, and called upon the petitioner to pay 25% of the amountdemanded immediately, and the balance on or before 31-7-2004. The petitioner states that on 30-7-2004, he again made similarrepresentation to the respondent, and to prove his bona fides, he also repaid anamount of Rs.70,000/-, and he is still required to repay an amount of Rs.2,46,013/-, and while so, he states that as per the computer statement of account furnished bythe respondent on 12-12-2004, the outstanding amount payable by the loanee isshown as Rs.4,19,799-56, which is incorrect.
As the total amount was not repaid by the loanee, it appears that the respondentissued possession notice of the property mortgaged by the petitioner as security tothe loan, and subsequently, issued the impugned Auction Sale Notice for realizationof the outstanding dues of the borrower.
Heard the learned counsel for the petitioner. The learned counsel for the petitionersubmits that the petitioner is not the borrower, the borrower having defaulted, thepetitioner is ready and willing to pay the loan amount, and after giving credit to theamount of Rs.70,000/- paid by him, he is liable to pay only an amount ofRs.2,46,013/-, and it is not known how the respondent could have shown the loanoutstanding at Rs.4,19,799-56, which is incorrect. Inasmuch as the petitioner hasagreed to repay the amount of Rs.2,46,013/-, the impugned Auction Sale Noticeissued by the respondent for sale of the property mortgaged by him, which is worthmore than Rs.25,00,000/-, should be stayed and the respondent be directed to grantthe petitioner to pay the amount of Rs.2,46,013/- in instalments spread over a periodof six months.
What are the amounts due and liable to be paid by the borrower or the petitioner,who is the surety, what are the amounts paid by them towards discharge of loanamount, what is the interest that is to be levied and how the interest has to becalculated, are all disputed questions of fact, which cannot be gone into in aproceeding under Article 226 of the Constitution of India, for they are matters whichrequire full-dressed trial. Be that as it may, according to the own admission of thepetitioner, the borrower having availed the loan, failed to repay the same owing tobusiness losses. Inasmuch as the petitioner submitted his house property titledocuments to secure the loan taken by the borrower, and as the borrower haddefaulted in repaying the loan amount, the respondent issued notice to the borrowercalling upon him to repay the loan amount under the Act, and as neither theborrower nor the petitioner, who is the surety, repaid the amount, the respondentissued possession notice followed by Auction Sale Notice, and no exception can betaken thereto. Though the petitioner contends that he is ready and willing to repaythe total loan amount in instalments, the fact remains he is disputing the amountsdemanded by the respondent, and if there is no dispute as to the amounts repayable by the borrower or loanee, whether to grant instalments to repay the loan amount, ispurely within the domain of the respondent, who has advanced the loan, and it is notfor this Court to direct the respondent to grant instalments.
There is no merit in the writ petition, and the same is accordingly dismissed. Nocosts.
Date: 31[st] December, 2004.
KSR
_________________
N.V. RAMANA, J.
// TRUE COPY //
..... REGISTRAR
SECTION OFFICER
To
1. The Indian Overseas Bank, 630, V.V. Mahal Road, Tirupathi, Chittoor District, Rep. by its Authorised Officer.
2. Two CD copies.