Can bank sell my property under SARFAESI act if it is in my name

657 votes

The answer is yes, the bank can sell the property through auction but till the time the property is sold the borrower has the right to recover the security (property) by remitting the dues. While applying for the credit you should have signed documents wherein you gave away your right (ownership) to the bank in case of default. Please check whether the creditor done everything as per the provisions of SARFAESI Act while classifying your account as NPA and also in issuing the required notices under Sec.13 of SARFAESI and Rule 8 & 9 of Security Interest (Enforcement) Rules before conducting a valid sale. The bank will issue sale certificate in favour of the buyer and the defaulter have to confirm the same.

Hope this satisfy your query.

Advocate Shobhan M P LawRato

700 votes

yes bank has all the authority to attach the property and can proceed under the said act, without any hindrance and your consent is not needed at all , as you have been labelled as NPA, and you have to watch the proceedings and if there is anything objectionable , with regard to sale of the said property you can approach DRT and escalate the same .

Advocate RS Raghavan LawRato

810 votes

The property offered as collateral security by depositing title under MOD can be taken symbolic possession by bank under section 13(4) of the sarfaesi Act after the expiry of 60 days notice period issued vide section 13(2) of the same act.

You have a relief to aproach DRT under section 17 of the same act.

The borrower has a right to challenge the Bank’s action on all measures pursuant to section 13 (4) of the Act before the Debt recovery Tribunal under section 17 of the act.

The borrower's interest is also protected even at the stage when the Bank approaches the Magistrate Court under section 14 of the Act and gets an order to take the physical possession of the ‘secured asset’.

The Section 19 of the SARFAESI Act, 2002 provides an authority to the Debt Recovery Tribunal to order compensation against the Bank in appropriate cases. The compensation can not be limited to the issue of procedural lacunae on the part of the Bank in taking steps under the provisions of SARFAESI Act, 2002. In appropriate cases, the claim of compensation or the damages can also be looked at while entertaining a plea for granting stay of SARFAESI proceedings initiated by the Bank. It is supported by the laudable interpretation by the Court on the issue of powers granted to the Debt Recovery Tribunal under section 17 of SARFAESI Act, 2002.

Since the property is not mortgaged you will not find an entry in EC to this effect, but since title deeds has been deposited for the purpose of collateral security, the bank may proceed on that basis invoking sarfaesi act.

Once the bank takes possession, it may go ahead with the auction selling of the property as per rules, it need not take your consent.

The sale deed also shall be executed by bank to the buyer

Advocate T Kalaiselvan LawRato

948 votes

Hello, yes bank can take action under sarfaesi act if the property is mortgaged the bank and there is default in payment. Bank can get the property auctioned and recover the loan amount alongwith interest, penalties, cost etc from the borrower. If the auction value is more than the recoverable amount of the bank balance of sale proceed shall be returned to the borrower.

Advocate Ranbir Singh LawRato