V.J. Dhanapal v. Union Bank of India and Ors. C.R.P. (PD) No. 3697 of 2017
The present case was a revision petition filed by the petitioner borrower, V.J. Dhanapal, who was one of the partners of M/s. Haris Chicken which had been receiving financial assistance from the Union Bank of India, Bangalore. There was a default on his part, due to which the account of the borrower was classified as a Non-Performing Asset (NPA). Thereafter, the respondent bank issued an auction sale notice, fixing the date for sale on 27/9/2013. The petitioner challenged the notice due to non-compliance of the requirements under Section 13 of the Securitisation and Reconstruction of Financial Assets and Enforcement of Securities Interest (SARFAESI) Act of 2002 before the Debt Recovery Tribunal (DRT) and the Debt Recovery Appellate Tribunal (DRAT), after which the petitioner borrower approached the Hon’ble High Court of Madras. The Debt Recovery Tribunal made a ruling in favour of the borrower, after which the DRAT overruled the same, after which the borrower approached the HC. The bank had claimed that the petitioner/borrower had committed a default in payment and there were dilatory tactics on their part, in repayment. It was also claimed by the bank that the borrower had been litigating, by filing applications before the Tribunal. By making the aforementioned claims, the bank claimed that there was a waiver of statutory provisions stated under Section 13 of the SARFAESI Act, by the borrower of the notice period of 30 days and that the said mandatory period of 30 days, thus can be ignored.
Held: It was held by the Hon’ble Court that, merely because the petitioner has committed default in payment and even taking it for granted that there was dilatory tactics, in repayment, and that the borrower has been litigating, by filing applications before the Tribunal, the same are not tenable grounds, to arrive at the conclusion that there was waiver of statutory provisions, by the borrower of the notice period of 30 days and that the said mandatory period of 30 days, can be ignored. It was further held that the decision of the Debts Recovery Appellate Tribunal, Chennai was contrary to the well settled judicial pronouncements of the Hon’ble Supreme Court. The Hon’ble Court further directed the Bank to restore the possession of the borrower’s property to him, within a month from the date of receipt of a copy of the order.
Authored By: Adv. Anant Sharma & Abhijith Christopher