Mumbai, Feb 27 (TOI): A small-time Andheri businessman who ran up a debt of Rs 58 lakh and had to wind up his printing business has approached the Bombay high court to save his family’s 1BHK flat.
Avinash Shingnapurkar (48) has claimed in his petition that while big businesses with crores in unpaid loans have not been touched, small and medium enterprise traders like him are being targeted and harassed under the draconian SARFAESI Act.
He has received a notice from his bank that it will take over possession of his home on February 27, 2018.
His counsel, advocate Mathews Nedumpara, on Monday mentioned the petition for urgent hearing before a division bench of Justices Amjad Sayed and Vijay Achliya. The bench has scheduled the matter for hearing on Tuesday. “It’s a travesty of justice that while (over Rs 7.6 lakh crore) is classified as non-performing assets (NPA) of 500 big companies and some (businessmen) are even allowed to leave the country, small traders and entrepreneurs who cannot repay loans not only because of their own fault, but also because of their banks’ are dispossessed of their very home, that too without observing the first principle of natural justice,” said Nedumpara. He said no hearing was given to Shingnapurkar before an order was passed by his bank that would lead to him and his family comprising of his son and daughter and aged parents from being dispossessed from their home in Marol, Andheri (east).
The petitioner has challenged section 14 of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest (SARFAESI) Act, which allows a magistrate to order the dispossession of a borrower on an application by the bank, without giving a hearing to the affected parties. Shingnapurkar has urged the court to restrain the bank and its officials from dispossessing his family of their home. He has also sought directions to the Union government to bring in appropriate legislation to exclude small and medium enterprises, and professionals and traders who have availed of loans below Rs 5 crore from the purview of the SARFAESI Act. He has also sought that the provisions of the law should not apply in cases of borrowings of up to Rs 10 crore where the value of assets or property of the borrower is less than Rs 2 crore.
According to Shingnapurkar, he had bought a Chinese-make digital printing machine for Rs 32 lakh in 2016 to start a business. He had applied to the bank for a loan of Rs 1.5 crore to be able to run his business. The bank sanctioned only Rs 55 lakh and his plea for further funds was rejected. The business soon ran into losses as he was not able to get more funds needed for it and within a year he had to shut shop for lack of capital. He had to sell his imported machine at a scrap value of Rs 7 lakh, his petition said. The bank declared his dues as NPA and initiated proceedings to recover the amount. Based on an application by the bank, the chief metropolitan magistrate on February 7 passed an order for taking possession of his flat.