Punjab & Haryana High Court: Even though the dispute is regarding Interest Rates, nothing was stopping the Petitioners from Making Loan Payments, upholds Bank’s Decision to Auction the Mortgaged House

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The Petitioner No.1, who is the sole proprietorship concern of the Petitioner No.2 had obtained a Cash Credit Limit of Rs.32 lakh and a Term Loan of Rs.3 lakh in the year 2016 from the respondent bank and in lieu thereof had inter-alia mortgaged the residential house of the Petitioner No.2. However, by the impugned notices the bank had recalled the loan and sought to auction the said property.

It was found from the record that from 01.01.2019 till today, one of the two petitioners have deposited only a sum of Rs.1,53,000/- towards servicing of the Cash Credit Limit and Term Loan.

A question was put to the learned counsel as to why the petitioners did not make any deposit beyond the amount of Rs. 1,53,000?

The counsel for the petitioner responded that this was because the respondent-bank had suddenly started charging excessive interest.

The Court found the explanation hardly cutting any ice yet the learned counsel was asked that in case the petitioners deposits a sum of Rs.7 lakh within one to two days, the Court could consider granting some relief.

The learned counsel sought time to talk to his client and after a few minutes, the matter was taken up again where the learned counsel stated that the petitioners would be able to pay only a sum of Rs.2 lakh in one day and would deposit the further sum of Rs.5 lakh within three weeks.

The Court observed that

Considering the arguments of the petitioner, the court ruled that no relief can be granted to the petitioners. The conduct of the petitioners reveals that they were just seeking time and were not serious about making the due payments to the respondent-bank.

The Court further observed that even though there was a dispute regarding interest, nothing was stopping the petitioners from depositing money at what, as per them was the interest rate. Consequently, the petition was dismissed.

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