Jasmin K. Vs State Bank of India (Kerala High Court)
The case of Jasmin K. vs. State Bank of India, as adjudicated by the Kerala High Court, raises a pivotal question regarding the continuation of measures under the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (SARFAESI Act), after the dismissal of a civil suit filed by the secured creditor.
Jasmin K., the petitioner, had availed a car loan from the State Bank of India (SBI) and had executed necessary security documents. Despite claiming to have paid the entire loan amount, Jasmin received notices under Section 13(2) of the SARFAESI Act, indicating outstanding dues. Jasmin objected to these notices, leading to subsequent actions by SBI. During the pendency of the writ petition, SBI filed a commercial suit, which was later dismissed by the Commercial Court, Kottayam, on the grounds of no liability on Jasmin’s part.
The crux of the matter lies in whether SBI can proceed with SARFAESI Act measures despite the dismissal of the civil suit. SBI argued that the two actions—civil suit and SARFAESI proceedings—are independent and can be pursued simultaneously. Conversely, Jasmin contended that the dismissal of the civil suit should halt SARFAESI proceedings as there is no legally recoverable debt.
