Mst. Sundri Vs Jammu & Kashmir Bank Ltd. (Jammu & Kashmir High Court)
Jammu & Kashmir High Court has ruled that a fresh notice to the legal heirs of a deceased borrower is not a mandatory requirement for a secured creditor to take possession of a secured asset under Section 14 of the Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (SARFAESI Act).
The ruling came in the case of Mst. Sundri vs. Jammu & Kashmir Bank Ltd., where the petitioners challenged an order from the Chief Judicial Magistrate, Srinagar, which granted the respondent bank the right to take possession of a property. The petitioners, who are the legal heirs of the deceased borrower, argued that the bank’s application was invalid as it was filed against a deceased person. They contended that a fresh notice should have been served to them before the bank could proceed with the possession of the secured asset.
The court, after reviewing the arguments and relevant provisions of the SARFAESI Act, dismissed the petitioners’ claim. The bench observed that the only notice a borrower is entitled to is the one issued under Section 13(2) of the Act, which demands that the borrower discharge their liability within 60 days. In this case, the court noted that the deceased borrower, Abdul Aziz Sofi, was served with this notice on March 7, 2023, during his lifetime. The borrower failed to clear the liability within the stipulated period, giving the bank the right to proceed with enforcement measures under Section 13(4) or Section 14.
