The petitioner had applied for a home loan of Rs. 3 crore from the respondent bank in 2017. Despite making regular payments until November 2023, the petitioner missed the December installment, leading the bank to declare the loan an NPA in February 2024. In a bid to mitigate the situation, the petitioner deposited Rs. 1 crore in April 2024, followed by additional payments in May and July. However, the bank issued a notice for auctioning the property in July 2024, prompting the petitioner to request a loan restructuring.

The matter escalated when the Chief Judicial Magistrate ordered the possession of the property, which serves as the petitioner’s residence. Following this, the petitioner appealed to the DRT, which instructed the bank to consider the restructuring request. However, the DRT ultimately denied interim relief to the petitioner, prompting an appeal to the DRAT, where the petitioner was ordered to deposit 25% of an assessed outstanding amount before her appeal could be heard.

The petitioner’s legal counsel argued that the bank had illegally clubbed the home loan with a cash credit facility taken by the petitioner’s son’s business, asserting that the two loans were distinct and separate. The counsel claimed that the assessment for the pre-deposit was arbitrary and unjust, as it forced the petitioner to address the combined debts rather than her individual home loan obligations. Additionally, the petitioner contended that the loan account was declared NPA before the required legal notices were issued, thereby invalidating the bank's subsequent actions. The counsel highlighted that the property in question was allegedly mortgaged only for a portion of the debt, rather than the full amount claimed by the bank.

Upon reviewing the case, the High Court found that the DRT and DRAT had followed the legal framework correctly in determining the need for a pre-deposit as a condition for appeal. The court noted that the petitioner’s assertion regarding the classification of the mortgage was not supported by the documentation provided. Moreover, it emphasized that issues regarding the legality of the NPA classification should be addressed by the DRAT rather than the High Court at this stage.

The court ultimately concluded that the petitioner's claims lacked sufficient documentary backing to justify altering the DRAT's directive. As a result, the writ petition was dismissed without costs, reinforcing the idea that legal proceedings must adhere to established protocols and timelines.

This case serves as a reminder of the complexities involved in financial disputes, particularly those that intertwine personal and business liabilities. The decision underscores the importance of clear documentation and adherence to legal processes when contesting banking decisions. As the petitioner is relegated back to the DRAT, the outcome of this case will depend on further scrutiny of the arguments and evidence presented.