M/S Sri Chandana Paraboiled Rice Mill v. Andhra Bank

HON'BLE SRI JUSTICE V. RAMASUBRAMANIAN AND HON'BLE SRI JUSTICE R. KANTHA RAO Writ Petition No.15585 of 2016 ORDER: (per Hon'ble Sri Justice V.Ramasubramanian) The petitioner has come up with the above writ petition challenging the notice issued under Section 13(2) of the SARFAESI Act, 2002 (for short 'the Act').

2. Heard Sri G.R.Sudhakar, learned counsel for the petitioner and Sri P.V.Uma Sankara Rao, learned counsel for the respondentbank.

3. At the stage of notice under Section 13(2) of the Act, a borrower cannot have a cause of action. The notice under Section 13(2) of the Act is issued to give a liberty to the borrower to discharge his liabilities within 60 days. Sub-section (3) of Section 13 of the Act makes it mandatory for the bank to give details of the amount payable by the borrower and the details of the secured assets intended to be enforced by the secured creditor in the notice issued under subsection(2). If the borrower makes a representation or raises any objection, the secured creditor is obliged to consider such a representation or objection, by virtue of the provisions of sub-section 3(A) of Section 13 of the Act. It is only after the secured creditor finally determines the fate of the objection or representation made by the petitioner that a measure under Section 13(4) of the Act is liable to be taken by the secured creditor. It is only at that stage that the borrower can come before the Debt Recovery Tribunal under Section 17 of the Act. As on date, the petitioner has no cause of action.

4. Therefore, the writ petition is dismissed. However, the bank shall follow the procedure contained in Section 13(3A) of the Act.

There is no order as to costs. Pending miscellaneous applications if any, in this writ petition shall stand closed. _______________________ V.RAMASUBRAMANIAN, J ________________ R.KANTHA RAO, J Date: 29.04.2016 BSS HON'BLE SRI JUSTICE V.RAMASUBRAMANIAN AND HON'BLE SRI JUSTICE R.KANTHA RAO Writ Petition No.15585 of 2016 (per Hon'ble Sri Justice V.Ramasubramanian)

Date: 29.04.2016 BSS