Banks can publish photographs of wilful defaulters in newspapers, rules Supreme Court of India

The borrowers defaulted in repayment of loan. The bank initiated action under Sarfaesi Act (Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act) 2002. The Bank issued notice under Section 13(2) of said Act. The Bank then issued further notice that if the account is not regularized within 10 days, the bank would publish the photographs of the directors and Guarantors of the borrower company in the newspapers.

The borrowers challenged this letter of the bank by way of a writ petition WPL No. 2808/2013 in the Bombay High Court. The High Court referred to Rule 8 of the Sarfaesi Rules and noticed that the said Rule permit the bank to publish the names and addresses of the defaulters . The Division Bench of the High Court observed that such publication of names serve two purposes – firstly that these persons are willful defaulters is made known to the public at large and secondly, it  tends to caution the prospective buyers  who may be offered the property which may be mortgaged by these defaulters with the bank.

After so observing, the High court held that that being the primary objective for publication of notice, there would be no impediment in publishing the photographs of such willful defaulters and particularly those defaulters who have committed various acts of misfeasance. The High Court however cautioned that banks should not publish the photographs of willful defaulters in a routine manner. Only after examining the facts and circumstances of each case, the bank should consider whether the photographs should be published.

Having said so, in peculiar facts of said case, the High court (Justice V.M.Kanade and Justice M.S.Sonak) did not find any fault with the proposed action of the bank to publish the photographs of directors and guarantors of the defaulter borrower company and dismissed the writ petition. 

The borrower company and its directors / guarantors challenged the said decision dated 28th November 2013 of Bombay High Court in  the Supreme Court of India. The Supreme Court (Justice F.M.I. Kalifulla and Justice Shiva Kirti Singh) by its order dated 14th July 2014 dismissed the said SLP No. 37726/2013 and thus the judgment given by Bombay High Court was upheld. 

National Commission issues notice to owners and dealer of Jaguar brand cars in India

National Consumer Disputes Redressal Commission of India on 11^th July 2014 issued notices to the manufacturer of luxury brand car Jaguar M/s Jaguar Land Rover India Pvt. Ltd., Tata Motors Ltd. who has purchased Jaguar brand sometime back and their authorized dealer AMP Motors Pvt. Ltd. and their directors on a petition filed by Delhi based company M/s ALM Infotech City Pvt. Ltd. through their advocate Mr. Sunil Goel of S.G.Solicitors law firm.

The petitioner had purchased the car Range Rover 5.0 S/C Autobiography for about Rs. one crore but within days of purchase it started giving trouble. Several parts were replaced again and again but problem continued. The car went to authorized dealer’s workshop for more than 20 times in about two years but dealer could not fix the snags in the car and offered sops like extended warranty and discounts on parts and labour. About Rs.20 lakh worth of parts were replaced free of charge and another Rs.20 lakh worth of parts were replaced by charging the amount to the customer. Ultimately, the purchaser approached the National Commission. The customer prayed for replacing the car with brand new car of the same or similar model and in the alternative to refund the price paid by him for the purchase with interest as also substantial amount on account of compensation for mental harassment and trauma as well as the litigation cost. The National Commission yesterday issued notice to the car maker, dealer and their directors and fixed the matter for 8^th October 2014 for hearing.

If the National Commission ultimately allows the petition, it will bring ray of hope for several such customers who are facing problems in costly branded luxurious cars without any relief from the dealers and car makers. 

Supreme Court : Women increasingly using the anti-dowry law to harass the in-laws

The Supreme Court of India in an important judgment passed on 2nd July 2014, said that women are increasingly using the anti-dowry law to harass in-laws and restrained police from mechanically arresting the husband and his relatives on mere lodging of a complaint under Section 498A of the Indian Penal Code. The Supreme Court issued guidelines to be followed by the police in such matters. The Court further held that these guidelines have to be followed by the police and magistrates in all cases where offence is punishable upto 7 years. 

See complete Judgment