VIVEK RUSIA,J. - (1.) The petitioner has filed the present petition being aggrieved by notice dated 29.09.2016 and 05.10.2016 issued by the Dena Bank demanding interest from the petitioner.
(2.) Facts of the case, in short, for disposal of this writ petition are as under:- (a) The petitioner is a Proprietorship Firm engaged in the business of civil construction. The firm is represented by its Proprietor Mohd. Ali Usmani and the firm is having office at EK-460, Scheme No. 54, Vijay Nagar, Indore. The petitioner has availed cash facility to the tune of Rs. 94.00 lacs including house loan, vehicle loan and construction loan from the Respondent-Bank. (b) Since the petitioner has failed to re-pay the loan amount within the time, therefore, the Bank has initiated the proceedings under the provisions of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 [in brief "the SARFAESI Act, 2002"]by issuing a notice dated 30.09.2014 under Section 13 (2) the SARFAESI Act, 2002. In the said notice total outstanding dues were mentioned as Rs. 75.21 lacs. (c) The Bank has published auction notice for auctioning the various properties mortgaged by the petitioner to secure the loan amount. By way of auction sale held on 30.09.2015, the Bank has sold one secured assets i.e. Plot No. 1056-II, Scheme No. 114, Part-I, Indore and recovered the amount of Rs. 34.98 lacs. Thereafter the Bank has again published a notice dated 24.02.2016 in the newspaper for auction of the remaining properties of the petitioner to recover the balance amount Rs. 40.38 Lacs. The petitioner filed Writ Petition No. 2044 of 2016 challenging the subsequent auction notice. Vide order dated 22.03.2016 the writ petition was disposed of with liberty to the petitioner to negotiate with the bank in respect of the interest levied by the Bank. However, the Bank did accept the proposal of the petitioner and demanded the interest from the petitioner. That according to the petitioner as on 21.10.2015 the amount of Rs. 40.23 lacs was liable to be paid by the petitioner. By way of negotiation, the Bank has directed the petitioner to deposit Rs. 40.00 lacs by 26.09.2016 and also Rs. 20.00 lacs towards interest within 30 days. That between 26.09.2016 and 29.09.2016, the petitioner deposited the amount of Rs. 21.50 lacs and Rs. 18.50 lacs by way of cheque and according to the petitioner now only Rs. 23,000-00 is due against the entire outstanding amount of Rs. 75.21 lacs. (d) That vide notice dated notice dated 29.09.2016 and 05.10.2016 the Dena bank demanded amount of Rs. 20.00 lacks under the head of interest from the period 1.9.2014 to 29.9.2016 The petitioner has filed the present petition challenging notice dated 29.09.2016 and 05.10.2016 (i.e. Annexures-P/1 and P/2) on the ground that by notice under Section 13 (2) of the SARFAESI Act, 2002 the Bank has demanded amount of Rs. 75.21 lacs which include costs, charges and expenses and the petitioner has returned the entire amount to the bank. Therefore, now the Bank cannot demand the interest over and above Rs. 75.21 lacs which was including costs, charges and expenses. Hence, Annexures-P/1 and P/2 are liable to be set-aside and the Bank be restrained to charge interest over and above Rs. 75.21 lacs. (e) After notice, the Bank has filed the return by submitting that the Bank has issued notice dated 25.10.2014 under Section 13 (2) of the SARFAESI Act, 2002, only the outstanding dues was mentioned Rs. 75.21 lacs as on 30.09.2014. In this notice it is clearly mentioned that you are also liable to pay further interest on the above amount @ 16.75% per annum from 01.09.2014. It is further submitted that the Bank is liable to charge the interest on entire dues/loan amount unless it is paid in entirety. The amount of Rs. 75.21 lacs was dues on 30.09.2014 which the petitioner has paid up to 29.09.2016, therefore, he is liable to pay interest from 30.09.2014 to 30.09.2016 i.e. for the period of two years. Therefore, the Bank has committed any illegality to demand the interest from the petitioner.
(3.) Shri Raghvendra Singh Raghuvanshi, learned counsel appearing on behalf of the petitioner submitted that under Section 13 (2) the SARFAESI Act, 2002of the SARFAESI Act, 2002, the Bank can realize only the amount which was specified in the demand notice under Section 13 (2) of the SARFAESI Act, 2002. The amount mentioned in the notice issued under Section 13 (2) of the SARFAESI Act, 2002 includes costs, charges and expenses. They cannot demand any interest under Sections 13 (7) and 13 (8) of the SARFAESI Act, 2002 when the petitioner has paid the entire amount as mentioned in notice under Section 13 (2) of the SARFAESI Act, 2002. The Bank can claim the interest up to issuance of notice under Section 13 (2) of the SARFAESI Act, 2002 thereafter the accounts of the borrower gets NPA. Therefore, the Bank cannot charge any interest on the accounts which has been declared NPA. In support of his contention, he has placed reliance over the judgment of Apex Court in the case of M/s. Transcore v. Union of India, AIR 2007 SC 712 and Mardia Chemicals Ltd. v. Union of India, 2004 (17) AIC 1 (SC) : AIR 2004 SC 2371 .;