Legal Question in Banking Law in India

Sir,

I was in a partnership firm. My partner's son and daughter had two different proprietorship firms on their own. Since they wanted to get loans for their firms for the business by pledging an immovable property. The Mysore Silk Cloth Merchants Co operative Bank Ltd, in Bangalore after scrutinising the property documents with legal opinion agreed to sanction the loan. The market value of the property certified by the valuer at 45 lakhs as on the year 1999-2000.

The said bank sanctioned loans to the tune of 39 lakhs each personal loan of 3 lakhs each on different dates. For all the loans both owners of the property stood as surity. As the property owners none other than my partner's son and daughter - in - law, by mutual understanding I along with my wife and son transferred the sanctioned loan amounts to the business concerns of the property owners whenever it was released by the bank. The payment of interest was paid to the bank regularly.

Till the end of the year 2001 everything was fine but due to my ill health and family problems I was forced to shift my family to Chennai. I went to Chennai after getting assurance from the my partner and his son regarding the payment of loans to the cooperative bank will be taken care by them. But they failed to do so and the bank declared the loans as NPA by the management in the generalbody meeting by the President of the bank.

During the year 2003 I came to know that the bank after registering recovery of loan with the Sub- registrar as the loans was registered in the office of the Sub- registrar when it was released.

Before the above proceedings the bank had proceeded with recovery process by filing cases with the Joint Registrar of Co operative Societies in Karnataka which have their own court of law.

During the year 2011 I received a mobile phone call from the bank's President that there is a large amount of dues are to be paid by me and my family towards the loans which I could not believe. Anyhow he assured me that he will help me if I opt for one time settlement of the total amount due from my family. Also he requested me to show the interest for by making some kind of deposit immediately. As I did not had money in cash I sent some silver articles worth nearly 4 to 5 lakhs through my son who delivered it to the bank. But the OTS did not took place for the reasons I am not aware.

I contacted the Chief Executive Officer of the Bank asking him when the property documents was discharged to the owners of the property after registering with Sub Registrar why the bank gone with the process of recovery of the loans. He informed me that the bank recovered a sum of rupees one lakh as the loan amount was registered at one lakh as against thirty nine lakhs. Hence after getting a payment of one lakh they had discharged the property documents to the owners of the property. The owners of the property sold the property on the same day it was discharged.

Asking for the validity of the proceedings I have been demanding some clarifications for the last four years and have sent legal notices, e mails, complaining with Registrar of Co operative Societies in Karnataka, Joint Registrar of Co operative Societies in Karnataka, Assistant Registrar of cooperative Societies in Karnataka the copies of the correspondance I have sent to the Chief Minister of Karnataka, Minister of Cooperation in Karnataka and complaining even with Reserve Bank of India, Bangalore.

Kindly let me know the validity of the proceedings of the said bank against my family can the bank proceed with the recovery after discharging the property documents without recovering the loans which they have not informed me before doing so.

The complaint regarding the High Headedness of the bank has been lodged with Indian Cooperative on 8th July 2015. For any of my correspondence the said bank have not sent any reply.

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