TMI Blog2006 (3) TMI 775X X X X Extracts X X X X X X X X Extracts X X X X ..... t'). Annexure-'B' is the copy of the said notice. In response to Annexure-'B' notice, petitioners sent Annexure-'C' reply dated 29-7-2003. In Annexure-'C' reply the petitioners did not dispute their liability. The only defence was that the bank had already filed a suit for recovery of the amount and therefore the provisions of Section 13 of the Act could not be enforced against the petitioners. However, the bank filed Annexure-D' application dated 27-1-2005 under Section 14 of the Act in the Court of Chief Metropolitan Magistrate, Bangalore, The application was registered as Crl. Misc. No. 69/2005 on 28-1-2005. On 31-1-2005 the Chief Metropolitan Magistrate passed Annexure-'E' order directing ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 14 of the Act. 4. We have heard the learned Counsel for the petitioners and the learned Counsel for the respondent bank. 5. Sub-section (3A) was inserted in Section 13 of the Act with effect from 11-11-2004. Sub-section (3A) is extracted hereunder: (3A) If, on receipt of the notice under Sub-section (2), the borrower makes any representation or raises any objection, the secured creditor shall consider such representation or objection and if the secured creditor comes to the conclusion that such representation or objection is not acceptable or tenable, he shall communicate within one week of receipt of such representation or objection the reasons for non-acceptance of the representation or objection to the borrower: Provided tha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uch non-acceptance. If the borrower does not receive any communication from the secured creditor conveying the reasons for non-acceptance of the objection, he is entitled to presume that the secured creditor has found the representation acceptable and the objection tenable. Since the respondent-bank failed to discharge its statutory obligations under Sub-section (3A) of Section 13 of the Act, the action initiated by the respondent under Sub-section (4) of Section 13 and Section 14 is illegal and irregular. Hence the impugned proceedings under Sub-section (4) of Section 13 and Section 14 including Annexure-'E' order passed by the Chief Metropolitan Magistrate are liable to be quashed. Accordingly, the said proceedings and Annexure-&# ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... g why his representation or objection against the notice under Sub-section (2) is not acceptable and untenable. Thus the borrower has sufficient notice regarding the steps being initiated, the amount sought to be recovered and the consequences of not discharging the liability within the period stipulated in the notice under Sub-Section (2). In other words, the borrower is informed in advance that if the liabilities are not discharged within the stipulated period, the secured creditor will be resorting to any of the remedies available under Sub-section (4) of Section 13 of the Act and may file an application under Section 14 and the Magistrate may pass an order under Section 14. In our view, the above safeguards satisfy the principles of nat ..... X X X X Extracts X X X X X X X X Extracts X X X X
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