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Pravesh DabasAdvocate Delhi, India

06 · Banking, Finance & Insurance

SARFAESI Matters

The SARFAESI Act, 2002 allows secured lenders to enforce their security — such as taking possession of mortgaged property — without first going to court.

Under the SARFAESI Act, 2002, secured lenders can enforce their security, such as taking possession of mortgaged property, without first going to court.

What this covers

  1. 01Demand notices under section 13(2)
  2. 02Objections to demand notices
  3. 03Possession and auction of secured assets
  4. 04Applications to the Debt Recovery Tribunal under section 17
  5. 05Rights of tenants and third parties

How it generally works

When a loan account is classified as a non-performing asset, the lender can issue a demand notice giving the borrower sixty days to pay. The borrower can object, and the lender must respond.

If the dues are not paid, the lender can take possession of the secured asset and sell it, with the help of the district magistrate if needed.

A borrower or other affected person can challenge these measures before the Debt Recovery Tribunal under section 17, ordinarily within forty-five days.