- (1.)The instant petition filed under Article 226 of the Constitution is preferred by the borrower (partnership firm) petitioner no.1 and its partner petitioner no.2 along with petitioner no.3, who happens to be a guarantor in respect of Cash Credit Limit of Rs.20.00 Lakhs per annum for which hypothecation agreement was entered into by the petitioner firm on 23/12/2014 for operating expenses of Paper Trading business.
(2.)The property of the respondent no.3-guarantor was hypothecated to secure the said credit.
(3.)Due to default in repayment of interest the respondent Bank declared the cash credit account of petitioner as Non Performing Asset ("NPA" for brevity). Consequentially on 16/1/2019 vide Annexure P/4 notice u/S 13 (2) of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (for brevity "SARFAESI Act") was issued requiring the petitioner to discharge the liability to the secured creditor i.e. respondent Bank within 10 days, failing which respondent Bank shall be free to take recourse of clause (4) of sec. 13 of SARFAESI Act. The petitioner submitted his reply vide Annexure P/9 denying the default and also the rate of interest charged. However, it is contended by the petitioner that without considering the objections raised by the petitioner the respondent Bank filed an application u/S. 14 before District Magistrate Gwalior requesting for taking possession of the secured assets. In response to the notice issued by the District Magistrate Gwalior the petitioner submitted his objection vide Annexure P/12 questioning the very validity of the decision of the respondent-Bank to declare the account as NPA and also raising certain disputed questions of fact in regard to the quantum and justification of interest rate. It is further contention of the petitioner that an application for settlement was also filed expressing willingness to settle the matter vide Annexure P/3. It is however submitted that Bank did not respond to the offer. Thereafter it is submitted that due to first wave of Covid-19 pandemic the matter was in a limbo which culminated into issuance of impugned order u/S.14 of SARFAESI Act dtd. 26/11/2020 vide Annexure P/1 directing Tahsildar Dabra to ensure handing over of possession of the secured assets to the Bank. It is lastly submitted that the objection to the aforesaid impugned order preferred by the petitioner was also wrongly rejected on 31/8/2021 vide Annexure P/16.