KOCHI: Federal Bank, the Aluva-headquartered private bank, has taken possession of a running shopping mall in Kodungallur, Thrissur, after it defaulted on a loan amounting to nearly Rs 8.5 crore. Federal Bank officials said Njarakkattu Basheer, an NRI, took the loan for the four-storeyed Centro Mall. After defaulting on the loan, he started to collect rent from tenants in cash, instead of depositing it directly into the bank account. This forced the Federal Bank to take possession of the mall.
The four-floor shopping mall includes the basement and has 29 tenants. Federal Bank invoked the provisions of the SARFAESI Act, 2002, to take over the shopping mall, officials said.“The bank also invoked the powers of Section 13 (4) (d) and Section 13 (5) of Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002, whereby notices were also served on the tenants in the shopping mall, calling upon tenants to remit the rent with the bank,” a statement by Federal Bank said here.
Around 30 officers of the bank’s Recovery Department participated in the action.Officials said the total dues from the borrower group is Rs 8.5 crore and the bank took over the mall for the default of the personal loan of Rs 1.5 crore.A few months ago, Federal Bank had been in the news when it took possession of an aircraft by invoking the provisions of Insolvency & Bankruptcy Code 2016 to recover loan dues. Now the sale process of that aircraft is under way. The Federal Bank recovery team was led by Babu K A, senior vice-president and Mohamed Sageer T A, vice-president, head office. Babu said the bank move should be a warning for other big defaulters who purposefully default on loans after availing of large sums from the banking industry. He said similar and more intensive measures are being planned against other big defaulters.