PRAKASH Vs. AUTHORISED OFFICER

JUDGEMENT

(1.) IN this writ petition petitioner challenges the proceedings initiated against him under the SARFAESI Act and the prayer made is to direct the Bank to regularize the loans in order to enable him to pay the balance amount as per the loan agreement with the Bank.

(2.) HOWEVER , instructions obtained by the learned counsel for the Bank shows that the petitioner had availed of four loans among which, two were term loans. First term loan was sanctioned to the petitioner in 2007 for a period of five years. Period of that loan is over and therefore, there is no question of regularizing the said loan. The second term loan was availed in 2010, for a period of three years and the period will soon be over. Therefore, that loan also cannot be regularized. The third facility enjoyed by the petitioner was a cash credit facility. That was availed of by the petitioner in 2007 for the purpose of establishing a nursery business. According to the Bank, that business has been discontinued by the petitioner. If the business, for the purpose of which facility was availed of, is no longer continued by the borrower, Bank cannot be expected to continue the arrangement by regularizing the loan. For the aforesaid reasons, all the three facilities cannot be regularized. Therefore, petitioner will have to discharge the entire liability due towards these three facilities.

(3.) 4th loan availed by the petitioner was a housing loan. That was availed of in 2010 and according to the petitioner, as at present towards the defaulted instalments itself Rs.2,73,000.00 is due. Since the period of this loan is not over, if the petitioner pays the overdue amounts, there is no reason why the loan shall not be regularized.