Can Banks Continue SARFAESI Proceedings Against Loan Accounts Declared NPA Before Lockdown: Kerala HC Seeks Response From Centre

Former Judges of the Kerala High Court to join the Central Government

The Kerala High Court has sought response from the Central Government about the bank’ plea seeking permission to continue SARFAESI proceedings with respect to loan accounts which were declared as NPA prior to the declaration of lockdown.

The Full Bench comprising the Chief Justice S. Manikumar, Justices CT Ravikumar and Shaji P. Chaly was considering an application filed by State Bank of India and Canara Bank who sought a clarification whether they can continue with SARFAESI proceedings which were already initiated.

In this order posted on 23rd September, the Court placed importance on an earlier order where the Bench had observed that in view of Covid 19 pandemic situation, the litigants may not be free to approach the Courts/Tribunals for vindicating their grievances against any coercive/recovery action taken by the institutions. The Court therefore said, that the request of the banks can be considered after the Supreme Court passes orders in the matters pending before it and also directed the Centre to file response on subsequent events in the Supreme Court and also to submit as to whether guidelines have been issued as per the order of Supreme Court given on 20th March.

Ria Nair
“Creative approach coupled with patience, makes understanding intricate issues simpler.” I am Ms. Ria Nair and my aim is to help you perceive a complex idea in a better way and seek your answer/s. I am currently pursuing my Bachelor’s in Business Administration and Law [B.B.A. LL. B (Hons.)] from Amity University, Mumbai. Understanding laws that govern human relations in all fields, gaining knowledge about aspects that govern the Universe and keeping an open mind are of primary importance to me as a law student and a human being. I hope to learn with every new opportunity and contribute to make others’ lives simpler.