M MAHALAKSHMI Vs. AUTHORIZED OFFICER

JUDGEMENT

(1.) According to Tamilnadu Mercantile Bank, Krishnagiri, the borrower, who has availed a term loan of Rs.18.21 Lakhs for purchasing machineries and another term loan for an amount of Rs.20.19 Lakhs, for construction of factory and buildings, has defaulted. Hence, on 31.03.2016, the bank has declared the loan account, as non-performing asset. Bank has also instituted Original Application for recovery. Bank has issued notice dated 02.05.2016 under Section 13(2) of the SARFAESI Act, 2002, demanding a sum of Rs.17,02,257/- & Rs.19,91,757/- with future interest at 18.15.%(or) BRR Plus 2% P.I. to be paid, within sixty days from the date of 13(2) notice, failing which, the bank would take possession of secured asset and sell the same, appropriate the deposit to the abovesaid dues. Property hypothecated and offered as security by way of equitable mortgage, as per the demand notice dated 02.05.2016 issued under the SARFAESI Act, 2002, are as follows

(2.) Material on record discloses that thereafter, Appanraj Ice Cream has sent a letter dated 12.12.2017 to the Bank Manager, T.M.B.Limited, Krishnagiri. Thereafter, bank has issued a sale notice dated 18.11.2017 under Rules 8(6) & 9(1) of the Security Interest (Enforcement) Rules, 2002, for bringing the secured asset, viz., property mortgaged, for auction on 05.01.2018. Without challenging the said auction notice dated 18.11.2017, in the manner known to law, proprietrix of Appanraj Ice Cream, the borrower, has filed instant writ petition for a direction to the Authorised Officer, Tamilnadu Mercantile Bank, Krishnagiri, the 1st respondent herein, to recall the proceedings initiated under the provisions of SARFAESI Act, 2002 and prayed for a further direction to the 1st respondent bank to render financial assistance to the petitioner in accordance with law and more particularly, in compliance with the guidelines issued by the Reserve Bank of India, 2nd respondent.

(3.) Supporting the prayer sought for, Mr.Krishnan, learned counsel for the petitioner, submitted that payments made towards, discharging the loan, has not been taken note of, by Tamilnadu Mercantile Bank. As per the guidelines of Reserve Bank of India, there should be a continuous default for 90 days and then only, the loan account can be classified as non performing asset. Inviting the attention of this Court to a decision of the Hon'ble Supreme Court in Anitha Kushwaha & Others Vs. Pushap Sudan & Others, 2016 8 SCC 509, Mr.Krishnan, learned counsel for the petitioner further submitted that there is an infringement of fundamental right, under Article 21 of the Constitution of India and that when sale notice has not been served on the writ petitioner, the whole proceedings are vitiated. He further submitted that when there is violation of principles of natural justice, writ petition can be entertained. Finally, considering the fact that auction is fixed today, learned counsel for the petitioner, offered to pay Rs.10 Lakhs towards the debt amount.