SANTHAMMA Vs. STATE BANK OF INDIA

JUDGEMENT

(1.) The issue involved in this case is, whether the petitioner/ guarantor is entitled to have the title deed returned in respect of the particular loan transaction, which has been admittedly closed, but retained at the hands of the respondent Bank referring to the liability of the petitioner as a guarantor to the other transactions as well; thus bringing in the doctrine of banker's lien.

(2.) The sequence of events as narrated in the Writ Petition shows that, the petitioner is one of the Directors of the Company by name M/s Hotel Amrita (P) Ltd. On the strength of the property offered as security, the Company had availed two different loans of Rs. 20 lakhs and another sum of Rs. 25 lakhs (a total sum of Rs. 45 lakhs) from the respondent Bank, creating security interest over the property. Subsequently, in view of the pressing needs another sum of Rs. 18,70,000/- was provided as loan to the Company, for which yet another property of 54 cents belonging to the petitioner was offered creating security interest over the same on 23.03.2007. The Company turned to be a defaulter, pursuant to which, the accounts were declared as 'NPA' and the Bank proceeded with steps under the SARFAESI Act which was sought to be resisted by the Company by filing W.P. (C) 34237 of 2009. The said case was disposed of as per Ext. P3 judgment dated 08.12.2009, enabling the Company to clear the 'overdue' amount of nearly 34 lakhs as specified, subject to which the coercive proceedings were ordered to be kept in abeyance. It was also made clear that, on clearing the overdue amount as above, the Company could seek for renewal of the loan account, which was ordered to be permitted by the respondent Bank.

(3.) It is the case of the petitioner that, the Company satisfied the 'overdue' amount and that steps are being taken to clear the entire outstanding amount as well. In the meanwhile, taking note of the need of the hour, entire outstanding liability in respect of the 3rd loan of Rs. 18,70,000/- sanctioned on 23.03.2007 was cleared and the title deed belonging to the petitioner herein was sought to be returned by filing a representation in this regard. However, the said title deed was refused to be returned by the Bank, stating that, the request could be entertained only on satisfying the entire outstanding liability under the other two loan accounts as well and that the Bank was very much entitled to have exercised the 'banker's lien' in this regard, which made the petitioner to approach this Court by filing this Writ Petition.