SARFAESI Act

Synopsis on Sarfaesi Act Vs Insolvency and Bankruptcy code, 2016

Corporate Law - Introduction Introduction of INSOLVENCY AND BANKRUPTCY CODE, 2016 has done away with overlapping provisions contained in The Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest Act, (SARFAESI ACT) 2002. Let’s distinguish between both Acts. SARFAESI Act The Securitisation and Reconstruction of Fina...

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Sarfaesi Act: Role & Powers of District / Chief Metropolitan Magistrate

Corporate Law - Amendment to SARFAESI Act introduced in 2013 brought out certain changes in the Act wherein under section 14 compulsory filing of an affidavit by the secured creditor through their Authorised Officer with the District Magistrate / Chief Metropolitan Magistrate, as the case may be, to take possession of the secured assets is introduced....

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Forum or Remedies available to Borrowers under SARFAESI Act-2002

Corporate Law - 1. Representation/objection to notice u/s 13(2) before banks The most Important section of Sarfaesi Act is section 13(2), which provides that if a borrower who is under a liability to a secured creditor, makes any default in repayment of secured debt and his account in respect of such debt is classified as non-performing asset, then [&hel...

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Symbolic V/s Physical Possession of Assets under SARFAESI Act-2002

Corporate Law - SYMBOLIC V/S PHYSICAL POSSESSION OF THE ASSETS One of the issues in enforcing the Sarfaesi Act, 2002 is whether the bank should obtain de facto possession/actual physical possession before putting the immovable property to sale under section 13(4) of the Act or should it contend with the symbolic possession under the same section. Section...

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Management of NPA: Who is Responsible for Account Becoming NPA?

Corporate Law - Recently I have undertaken an assignment of dealing with the legal proceedings initiated by three nationalized banks under SARFAESI Act of a Corporate Company who are service providers to infrastructure projects initiated by the State Governments and Central Government and some of them are being financed by World Bank and Asian Developmen...

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Draft ‘Fugitive Economic Offenders Bill, 2017’ -Govt invite comments

Corporate Law - It is widely felt that the spectre of high-value economic offenders absconding from India to defy the legal process seriously undermines the rule of law in India. It is, therefore, felt necessary to provide an effective, expeditious and constitutionally permissible deterrent to ensure that such actions are curbed....

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Enforcement of Security Interest and Recovery of Debts Laws (Amendment) Bill, 2011 approved

Corporate Law - The Union Cabinet today approved introduction of the Enforcement of Security Interest and Recovery of Debts Laws (Amendment) Bill, 2011 in the next session of Parliament. The proposed amendments would enable banks to improve their operational efficiency, deploy more funds for credit disbursement to retail investors, home loan borrowers, e...

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Civil Suit not Maintainable after initiation of SARFAESI Proceedings: SC

M/s Sree Anandhakumar Mills LTD. Vs M/s Indian Overseas Bank & ORS. (Supreme Court of India) - Though the case has a chequered history and the facts are long the matter lies within a short compass. The core question is one relating to the maintainability of the suit, viz., O.S. No.106 of 2009 filed by the second respondent – Nandini seeking partition wherein the order of injunction was pas...

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HC refuses to entertain writ petition filed, as an alternative remedy was available U/s.17 of SARFAESI Act, 2002

M/S Kanika Swami Vs State Of U.P. (Allahabad High Court) - In the present case, the petitioner has not made any representation under Section 13 (13-A) of the SARFAESI Act, 2002 before the bank and has approached this Court by-passing statutory mechanism which has been disapproved by the Supreme Court in the case of Devi Ispat Limited and another Vs. State B...

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TRO cannot attach property subjected to SARFAESI recovery proceedings

State Bank of India & Anr. Vs ITO (Orissa High Court) - Where properties attached by Tax Recovery Officer (TRO) had already been subjected to recovery proceedings by a secured creditor under SARFAESI Act, 2002, the attachment order was quashed in view of section 35 of SARFAESI Act which makes it clear that the Act would override other laws and would have...

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Even when mortgaged property belongs to guarantor, borrower would be a person aggrieved for filing appeal U/s. 17 of SARFAESI Act, 2002

Manik Mehta Vs UCO Bank, & others (Chhattisgarh High Court) - This petition under Article 227 of the Constitution of India has been preferred for quashment of the recovery and auction proceedings initiated against the petitioner by the respondent UCO Bank (the Bank henceforth); for quashing the appellate order dated 9-11-2011 passed by the Debts Recovery Appel...

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Borrower can Appeal to DRT even If Mortgaged property belongs to Guarantor

Manik Mehta Vs UCO Bank (Chhattisgarh High Court) - This petition under Article 227 of the Constitution of India has been preferred for quashment of the recovery and auction proceedings initiated against the petitioner by the respondent UCO Bank (the Bank henceforth); for quashing the appellate order dated 9-11-2011 passed by the Debts Recovery Appel...

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Security Interest (Enforcement) Amendment Rules, 2018

Notification No. G.S.R. 1040(E) - (17/10/2018) - Sale notice for sale of movable properties- E-Auction Sale Notice for Sale of Movable Assets under the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 read with proviso to Rule 6(2) of the Security Interest (Enforcement) Rules, 2002...

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SARFAESI Act 2002: Collection of taxes out of attached properties

F. No. 1(380)/DIT(R)/SARFAESI/ 17-18/ - (06/09/2017) - The SARFAESI Act has been amended on 12-08-2016 to extend the scope of the Act to provide for registration of security interest held by all other creditors, in addition to the banks and financial institutions defined as secured creditors under the Act. T...

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Setting up of Central Electronic Registry under the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act 2002

RBI/2010-2011/545 DNBS (PD) CC. No. 24/SCRC/26.03.001/2010-2011 - (25/05/2011) - DNBS (PD) CC. No. 24/SCRC/26.03.001/2010-2011 - Pursuant to the announcement made by the Finance Minister in the budget speech for 2011-12, Government of India, Ministry of Finance notified the establishment of the Central Registry vide notification F. No. 56/05/2007-BO-II dated March 31, 2011. The ...

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Recent Posts in "SARFAESI Act"

Synopsis on Sarfaesi Act Vs Insolvency and Bankruptcy code, 2016

Introduction Introduction of INSOLVENCY AND BANKRUPTCY CODE, 2016 has done away with overlapping provisions contained in The Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest Act, (SARFAESI ACT) 2002. Let’s distinguish between both Acts. SARFAESI Act The Securitisation and Reconstruction of Fina...

Read More
Posted Under: Corporate Law |

Security Interest (Enforcement) Amendment Rules, 2018

Notification No. G.S.R. 1040(E) (17/10/2018)

Sale notice for sale of movable properties- E-Auction Sale Notice for Sale of Movable Assets under the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 read with proviso to Rule 6(2) of the Security Interest (Enforcement) Rules, 2002...

Read More

Sarfaesi Act: Role & Powers of District / Chief Metropolitan Magistrate

Amendment to SARFAESI Act introduced in 2013 brought out certain changes in the Act wherein under section 14 compulsory filing of an affidavit by the secured creditor through their Authorised Officer with the District Magistrate / Chief Metropolitan Magistrate, as the case may be, to take possession of the secured assets is introduced....

Read More
Posted Under: Corporate Law |

Civil Suit not Maintainable after initiation of SARFAESI Proceedings: SC

M/s Sree Anandhakumar Mills LTD. Vs M/s Indian Overseas Bank & ORS. (Supreme Court of India)

Though the case has a chequered history and the facts are long the matter lies within a short compass. The core question is one relating to the maintainability of the suit, viz., O.S. No.106 of 2009 filed by the second respondent – Nandini seeking partition wherein the order of injunction was passed....

Read More

Forum or Remedies available to Borrowers under SARFAESI Act-2002

1. Representation/objection to notice u/s 13(2) before banks The most Important section of Sarfaesi Act is section 13(2), which provides that if a borrower who is under a liability to a secured creditor, makes any default in repayment of secured debt and his account in respect of such debt is classified as non-performing asset, then [&hel...

Read More
Posted Under: Corporate Law |

Symbolic V/s Physical Possession of Assets under SARFAESI Act-2002

SYMBOLIC V/S PHYSICAL POSSESSION OF THE ASSETS One of the issues in enforcing the Sarfaesi Act, 2002 is whether the bank should obtain de facto possession/actual physical possession before putting the immovable property to sale under section 13(4) of the Act or should it contend with the symbolic possession under the same section. Section...

Read More
Posted Under: Corporate Law |

HC refuses to entertain writ petition filed, as an alternative remedy was available U/s.17 of SARFAESI Act, 2002

M/S Kanika Swami Vs State Of U.P. (Allahabad High Court)

In the present case, the petitioner has not made any representation under Section 13 (13-A) of the SARFAESI Act, 2002 before the bank and has approached this Court by-passing statutory mechanism which has been disapproved by the Supreme Court in the case of Devi Ispat Limited and another Vs. State Bank of India and other (2014) 5 SCC 762....

Read More

SARFAESI Act 2002: Collection of taxes out of attached properties

F. No. 1(380)/DIT(R)/SARFAESI/ 17-18/ (06/09/2017)

The SARFAESI Act has been amended on 12-08-2016 to extend the scope of the Act to provide for registration of security interest held by all other creditors, in addition to the banks and financial institutions defined as secured creditors under the Act. T...

Read More

Management of NPA: Who is Responsible for Account Becoming NPA?

Recently I have undertaken an assignment of dealing with the legal proceedings initiated by three nationalized banks under SARFAESI Act of a Corporate Company who are service providers to infrastructure projects initiated by the State Governments and Central Government and some of them are being financed by World Bank and Asian Developmen...

Read More
Posted Under: Corporate Law |

TRO cannot attach property subjected to SARFAESI recovery proceedings

State Bank of India & Anr. Vs ITO (Orissa High Court)

Where properties attached by Tax Recovery Officer (TRO) had already been subjected to recovery proceedings by a secured creditor under SARFAESI Act, 2002, the attachment order was quashed in view of section 35 of SARFAESI Act which makes it clear that the Act would override other laws and would have effect notwithstanding anything inconsi...

Read More

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