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June 2008

Recovery of debts : Recovery of debts due to Banks and Financial Institutions Act : S. 19(7).

By Dr. K. Shivaram, Ajay R. Singh, Advocates
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13 Recovery of debts : Recovery of debts due
to Banks and Financial Institutions Act : S. 19(7).


The petitioner, his father and brother had jointly and
severally taken a loan from State Bank of India. On default the State Bank of
India initiated certificate proceedings against the three. At the time of
initiation of the proceeding itself the father and the brother had died. The
certificate was issued against all the three. The certificate officer later
dropped the proceedings and on appeal the collector remanded the matter back to
certificate officer to proceed against the petitioner.

On writ by the petitioner, it was held by the Court that the
certificate proceeding against the two dead person was void and unenforcecable.
But so far as the petitioner is concerned, the certificate issued was valid and
binding.

The loan was taken ‘jointly and severally’. The expression
‘jointly and severally’ implies their joint liability as well as individual for
entire loan amount. It was open for the creditor to proceed either against one
of the joint loanees or against all of them.

In view of the above the writ petition of the petitioner was
dismissed.

[Anand Mohan Singh v. State of Bihar & Ors., AIR
2008 Patna 53]

 


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