Contents
SARFAESI notice stages: Section 13(2) demand, Section 13(4) possession, Section 17 application
- Section 13(2) SARFAESI demand notice — 60-day objection under Section 13(3A)
- Section 13(4) possession notice — Securitisation Application, OTS or redemption
- Securitisation Application (SA) under Section 17 — 45-day brief and stay papers
- DRAT deposit — appeal after adverse SA
- Sec 14 + tenant (Harshad-type) protection
Bank auction notices and stopping the sale
- Bank auction notice under Rules 8 and 9 — defect checklist
- Section 13(8) redemption — pay the dues and stop the auction
Loan settlement and one-time settlement (OTS)
- Loan settlement and one-time settlement (OTS) with the bank — negotiation draft
Guarantor, co-borrower and mortgage questions
- Guarantor and co-borrower liability — limits and discharge
- Mortgage and secured-loan disputes — CERSAI search and title audit
- Co-operative society recovery as a dispute under s.69, Kerala Co-operative Societies Act / co-operative bank SARFAESI applicability
Wilful defaulter tags, DRT recovery certificates and High Court challenges
- Wilful defaulter classification challenge — reply to show-cause and writ
- DRT recovery certificate execution — objections and stay
- Challenge to DRT and DRAT orders in bank recovery matters — SARFAESI writ maintainability note
Bank account and service-deficiency disputes
- Account freeze vs PMLA attachment — triage
- PMLA Sec 5 provisional attachment — review and counsel referral
- CIBIL / credit-report dispute + damages
- RBI Ombudsman (bank deficiency) — complaint draft
- UPI / failed-transaction / chargeback
- Payment-aggregator hold (Razorpay/Cashfree etc.)
- Digital-lending / app-loan harassment — defence pack
SARFAESI notice stages: Section 13(2) demand, Section 13(4) possession, Section 17 application
Section 13(2) SARFAESI demand notice — 60-day objection under Section 13(3A)
60-day demand received; NPA date, amount, property description disputed.
What it involvesBorrowers, guarantors, mortgagors.
Relevant lawSec 13(2), 13(3A) SARFAESI; RBI NPA norms; CERSAI record.
ForumBank/Fl; then DRT SA if 13(4) follows.
Procedure & stageDemand audit (NPA date, break-up, interest, set-off, insurance, subsidy) → 13(3A) objection within 60 days with proofs → bank's reasoned reply tracked → SA ground preserved.
RemedyCorrection/withdrawal or strong SA pleading; no automatic stay.
High Court connectionWrit only for jurisdictional error/fraud; routine objections stay in SA – explained.
Documents normally requiredDemand, sanction, statements, repayment proofs, EC/CERSAI, insurance, correspondence.
LimitationObjection within 60 days of 13(2); SA 45 days from 13(4) – both diaried.
Related: SA-45-day; mortgage-audit; guarantor note.
Reply stops auction?
No – but defective reply strengthens SA stay.
Section 13(4) possession notice — Securitisation Application, OTS or redemption
Possession/sale notice pasted; borrower confused between court, settlement, redemption.
What it involvesHome/loan borrowers, SME mortgagors.
Relevant lawSec 13(4), 13(8); Rules 8/9 Security Interest Rules.
ForumDRT (SA) + bank (OTS) + court execution for redemption proof.
Procedure & stageNotice audit → parallel tracks: SA maintainability, OTS math, 13(8) redemption amount → choose/file without missing SA clock.
RemedyStay (DRT), settlement, or redemption with sale stop.
High Court connectionHC writ for tenant/bonafide purchaser issues alongside SA
Documents normally required13(4)/sale notices, valuation, EC, payment capacity, OTS prior letters.
LimitationSA 45 days from 13(4) measure – hard clock.
Related: Auction-Rule-8; 13(8) redemption; DRAT deposit.
File OTS – SA time extended?
No – file SA to protect clock while negotiating.
Securitisation Application (SA) under Section 17 — 45-day brief and stay papers
Needs urgent stay; DRT Ernakulam appearance needed.
What it involvesBorrowers/guarantors/tenants.
Relevant lawSec 17 SARFAESI; DRT Procedure Rules.
ForumDRT Ernakulam – appearance there is referred to counsel who practise before it.
Procedure & stageChronology + defect chart (NPA, 13(3A), Rule 8/9, valuation, service) → plaint-style SA draft + IA stay + paper-book → handover to DRT counsel → HC-tenant/writ track if separate cause.
RemedyStay/status quo, sale set-aside, costs.
High Court connectionDRAT appeal + HC writ for jurisdictional/bonafide-purchaser points (registry: OP(DRT), supervisory jurisdiction under Art.227)
Documents normally requiredFull loan file, notices with postal proof, photos of affixture, valuation, EC, repayment proof.
Limitation45 days from 13(4); interim filed with SA, not after delay.
Related: DRAT deposit; Sec 14 tenant.
Will you appear in DRT?
No – I draft the SA and stay application and hand them over to counsel who practise before the DRT; any High Court writ is handled directly.
DRAT deposit — appeal after adverse SA
SA dismissed; sale looming; DRAT demands 50%/25% deposit.
What it involvesSA appellants.
Relevant lawSec 18 SARFAESI (50%, reducible to 25% with reasons).
ForumDRAT Chennai (for Kerala) – appearance there is referred to counsel who practise before it.
Procedure & stageOrder audit → appeal + waiver/reduction prayer (hardship, prima facie, valuation surplus) with deposit plan → referral counsel filing.
RemedyStay on deposit; remand/reversal on merits.
High Court connectionHC writ only for jurisdictional error (registry: OP(DRT)); routine merits stay in DRAT – advice records this.
Documents normally requiredSA order, sale stage, valuation, payment capacity, deposit proof.
LimitationAppeal within 30 days of receiving the DRT order (S.18(1)); deposit 50% of debt (as claimed or determined, whichever less), reducible to not less than 25% with reasons.
Related: 13(8) redemption parallel; OTS.
DRAT waives full deposit?
Reduction to 25% on reasons possible, not assumed.
Sec 14 + tenant (Harshad-type) protection
Magistrate/AFC appoints commissioner; genuine tenant/lessee faces eviction.
What it involvesTenants in mortgaged shops/houses, lessees with registered lease pre-mortgage.
Relevant lawSec 14 SARFAESI; Sec 35 vs tenancy law; Harshad Govardhan Sondagar (SC, 03.04.2014): lessee in possession under a lease made before the mortgage is protected; lease over one year needs a registered instrument (S.107 TPA).
ForumCJM/ACJM commissioner stage + DRT SA + HC writ for lease-rights remedy.
Procedure & stageLease proof (registered, pre-mortgage, rent) → objection before commissioner/DRT → HC writ for protection/remand where DRT efficacious but possession imminent – drafted in HC Kerala.
RemedyProtection/restoration or time/damages; sale continues vs mortgagor.
High Court connectionHC writ/appeal for tenant – handled.
Documents normally requiredRegistered lease, rent receipts/bank, electricity/municipal proof, mortgage date vs lease date, photos.
LimitationAct on Sec 14 notice immediately; SA 45-day parallel preserved.
Related: Lease; auction-purchaser tenant issue.
Unregistered tenant protected?
Weak; registered pre-mortgage + possession is the tested path.
Bank auction notices and stopping the sale
Bank auction notice under Rules 8 and 9 — defect checklist
Undervalued sale, 30/15-day notice gaps, EMD forfeiture, inter-se bidding opacity.
What it involvesBorrowers, guarantors, auction purchasers.
Relevant lawRules 8/9; Sec 13(8) proviso; reserve-price/notice law.
ForumDRT SA; DRAT; HC for fraud/jurisdiction.
Procedure & stageNotice-service audit → valuation vs reserve → 30 days between sale notice/publication and first sale of immovable property (Rule 9(1)) + not less than 15 days’ notice for a re-sale after a failed sale (Rule 9(1) proviso) → publication/pasting photos → bid record → sale-certificate challenge or purchaser-title advice.
RemedySale set-aside or confirmation with title safety.
High Court connectionHC writ for bonafide-purchaser/third-party rights where DRT cannot mould fully
Documents normally requiredSale notices, paper publications, valuation, bid sheets, sale certificate draft, EC.
LimitationChallenge within SA 45-day from sale step; redemption before publication (see next).
Related: 13(8) redemption; CERSAI.
Auction at 30% of market – automatic cancel?
Must prove undervaluation + prejudice + procedure breach.
Section 13(8) redemption — pay the dues and stop the auction
Borrower can pay dues + costs before sale publication but bank refuses figure.
What it involvesBorrowers/mortgagors with funds/buyer.
Relevant lawSec 13(8) as substituted in 2016 (tender of dues + costs before publication of notice for public auction/quotations/tender/private treaty).
ForumBank + DRT (record tender) + HC for refusal.
Procedure & stageDues + costs computation → written tender + DD/RTGS proof → bank receipt → sale stop + reconveyance/CERSAI satisfaction.
RemedyMortgage redeemed; sale barred.
High Court connectionWrit for arbitrary refusal to accept/quoted excess
Documents normally requiredDues statement, tender letter, payment proof, EC/CERSAI.
LimitationBefore sale publication – hours matter; tender early with proof.
Related: OTS; auction checklist.
Part-payment stops sale?
Only full dues + costs/expenses as per Sec 13(8).
Loan settlement and one-time settlement (OTS)
Loan settlement and one-time settlement (OTS) with the bank — negotiation draft
NPA with viable lump sum; bank pushes auction while talks on.
What it involvesSME/home borrowers, guarantors.
Relevant lawBank OTS policy + Contract; SARFAESI clock continues.
ForumBank committee; DRT SA parallel to protect clock (referred).
Procedure & stageDues audit → capacity + source proof → OTS letter (amount, dates, sacrifice ask, default clause, NOC/CIBIL update, CERSAI satisfaction) → approval + compliance → closure-NOC.
RemedyDiscount + closure + CIBIL update; sale pause by agreement (not automatic).
High Court connectionWrit for discriminatory OTS refusal (public bank), facts-dependent.
Documents normally requiredDues, valuation, income/source, prior payments, draft OTS.
LimitationSA 45-day runs despite talks – file SA via counsel while negotiating.
Related: 13(8); DRAT; guarantor.
OTS offer stops auction legally?
No – only written approval/stay stops.
Guarantor, co-borrower and mortgage questions
Guarantor and co-borrower liability — limits and discharge
Guarantor served 13(2) though principal has stock/security; surety invoked first.
What it involvesFamily/friend guarantors, corporate guarantors.
Relevant lawContract Sec 126-139 (guarantee) + SARFAESI applies to guarantor's secured asset; discharge on variation/time (facts).
ForumDRT SA (referred) + civil court + HC writ on jurisdiction.
Procedure & stageGuarantee-deed audit (continuing/limited, cap, notice, variation consent) → 13(3A) + SA grounds → settlement/exit negotiation.
RemedyRelease/substitution, cap enforcement, marshalling argument.
High Court connectionWrit for no-notice possession vs guarantor-tenant overlap
Documents normally requiredGuarantee deed, sanction, variation letters, principal's security detail.
LimitationSame 60-day + 45-day clocks as borrower.
Related: PG-insolvency referral; co-op-69 contrast.
“Only signed as witness” – liable?
Deed language decides; witness vs surety box examined – note audits.
Mortgage and secured-loan disputes — CERSAI search and title audit
Buyer/bank unsure if property already charged; double mortgage risk.
What it involvesBuyers, lenders, borrowers.
Relevant lawSec 20-26 SARFAESI (CERSAI); Registration + EC.
ForumAdvisory; produced in SA/civil suit when title litigated.
Procedure & stageCERSAI search → EC + title chain → charge order + limitation check → audit note (priority, pari passu, satisfaction).
RemedyClean lending/buying; SA ground if prior charge unregistered.
High Court connectionNil standalone.
Documents normally requiredDeed, EC, CERSAI report, sanction, prior charges.
LimitationBefore disbursement/purchase; satisfaction filed post-closure.
Related: Auction title; co-op mortgage contrast.
EC clean = no charge?
No – CERSAI + EC + court-search combined – note does all three.
Co-operative society recovery as a dispute under s.69, Kerala Co-operative Societies Act / co-operative bank SARFAESI applicability
Co-op bank invokes SARFAESI vs Arbitration/Surcharge under Co-op Act.
What it involvesCo-op borrowers, societies.
Relevant lawKerala Co-operative Societies Act (s.69) vs SARFAESI; SARFAESI “bank” (S.2(1)(c)) covers multi-State co-operative banks and banks notified by the Central Government under S.2(1)(c)(v).
ForumCo-op Arbitration Court / Registrar vs DRT – election litigated; appearance before co-op forum referred as needed.
Procedure & stageNotice audit → jurisdiction note (which remedy bars which) → objection/SA/arbitration defence + HC writ for jurisdictional error.
RemedyForum correction; stay/transfer; merits adjudication in correct forum.
High Court connectionHC writ for jurisdiction
Documents normally requiredLoan/surety bond, demand, award/DRT notices, bye-laws.
LimitationObjection at first appearance; SA 45-day preserved in parallel where SARFAESI invoked.
Related: SARFAESI SA; guarantor.
Co-op can use SARFAESI?
Depends on bank category + notification.
Wilful defaulter classification challenge — reply to show-cause and writ
Bank committee proposes “wilful defaulter” classification; promoter/director faces CRILC listing, fresh-credit freeze and related regulatory consequences.
What it involvesPromoters, directors, guarantors of NPA accounts; show-cause from the bank's Identification Committee.
Relevant lawRBI Wilful Defaulters Directions (identification grounds — diversion, siphoning, disposal of secured assets, non-cooperation; show-cause with disclosure of material, reply within 21 days, 15-day written representation to Review Committee and personal hearing before final classification — RBI Master Direction, 2024).
ForumBank Identification Committee → Review Committee (hearing) → HC writ (W.P.(C)) against perverse or no-hearing classification; DRT/recovery track parallel where recovery proceedings run.
Procedure & stageShow-cause + relied-document demand → reply on facts (no diversion, stock/book-debt statements, bank's own delays, recession, OTS record) → personal hearing → Review Committee representation → writ brief on perversity/natural-justice breach.
RemedySetting aside/remand of classification, deletion from wilful-defaulter list/CRILC as court or bank grants – no automatic relief.
High Court connectionW.P.(C) against public-sector bank/committee action; Art.226 maintainability assessed per facts
Documents normally requiredShow-cause, account/stock statements, sanction terms, correspondence, hearing minutes, audit or forensic notes, OTS record.
LimitationReply within 21 days of the show-cause notice; representation to Review Committee within 15 days of the proposal; writ promptly after Review Committee order; recovery limitation separate.
Related: 13(2)/13(3A) objection; CIBIL/credit-report dispute; guarantor exposure.
Does the tag decide criminality?
No – it is a regulatory classification; credit and listing consequences flow from the directions.
DRT recovery certificate execution — objections and stay
DRT issues recovery certificate; Recovery Officer moves to attachment/auction; dues computation, exempt assets, third-party rights or sale procedure disputed.
What it involvesBorrowers, guarantors, third parties/tenants affected by recovery.
Relevant lawRDB Act Ss.25-30 (Recovery Officer powers and modes; appeal against a Recovery Officer order lies to the Tribunal (DRT) within 30 days under s.30 RDB Act – not to DRAT; the DRT→DRAT appeal is s.20, within 30 days of receiving the order, with s.21 pre-deposit of 50% of the debt determined, reducible to not less than 25%); CPC Order 21 principles applied.
ForumRecovery Officer, DRT Ernakulam → Tribunal (DRT) under s.30 → DRAT under s.20 (appearance there is referred to counsel who practise before it) → High Court (registry: OP(DRT), supervisory jurisdiction under Art.227).
Procedure & stageRC copy + dues reconciliation → objections (amount/interest, limitation, exempt assets, third-party rights, sale irregularity) → stay application before Recovery Officer/DRT → appeal to DRT (s.30) or HC writ as maintainable; SARFAESI DRAT track parallel where sale is under SARFAESI.
RemedyStay of attachment/sale, correction of certificate amount, release of exempt assets – as ordered; no automatic stay on objection.
High Court connectionHC petition (registry: OP(DRT)) only for jurisdictional error; DRT/DRAT appearance by referral
Documents normally requiredRecovery certificate, DRT order, recovery notices, payment proofs, EC, third-party title/lease, objection bundle.
LimitationObjections on receipt of notice; appeal to DRT within 30 days from Recovery Officer order (RDB Act s.30; further DRT→DRAT appeal within 30 days, s.20(3)); auction calendar tracked.
Related: DRAT deposit note (H3 4 above); 13(8) redemption; Sec 14 tenant protection.
Does an objection stop the auction?
No – only an express stay order does; file early with proof.
Challenge to DRT and DRAT orders in bank recovery matters — SARFAESI writ maintainability note
Adverse Debt Recovery Tribunal order or SARFAESI measure with jurisdictional defect.
What it involvesSecurity-interest audit, tribunal-remedy exhaustion mapping, limited writ grounds.
Relevant lawConstitution Art. 226; SARFAESI Act, 2002 / Recovery of Debts and Bankruptcy Act, 1993 (formerly the RDDBFI Act) (primary only).
ForumHigh Court of Kerala (limited writ scope; challenges to DRT orders are registered as OP(DRT)); DRT/DRAT statutory route disclosed.
Procedure & stageTribunal remedy first; writ only on jurisdictional/natural-justice grounds.
RemedyInterim: stay of sale/symbolic possession in fit cases with deposit. Final: quash/remand or direction to tribunal.
High Court connectionHC SARFAESI-writ practice with deposit-conditioned interim relief.
Documents normally requiredLoan/security papers, S. 13 notices, tribunal orders.
LimitationAuction calendar and tribunal appeal deadlines strictly tracked.
Related: Auction-process writs; stay petitions.
Direct HC against bank notice?
Generally tribunal first; writ is exception.
Deposit for stay?
Common condition.
Bank account and service-deficiency disputes
Account freeze vs PMLA attachment — triage
Debit freeze; is it bank lien, cyber-crime (BNSS/IT Act) hold, or ED Provisional Attachment?
What it involvesTraders, freelancers, account holders.
Relevant lawBank lien/set-off vs CrPC S.102 / BNSS S.106 (seizure powers) + IT Act vs Sec 5 PMLA.
ForumBank → cyber cell → Adjudicating Authority (PMLA), where appearance is referred to counsel who practise before it; High Court writ for an illegal freeze.
Procedure & stageFreeze letter + lien register + cyber-acknowledgement + PMLA order (if any) → triage chart → representation/unfreeze + writ/SA as per cause.
RemedyPartial/full release; lien adjustment; PMLA challenge via referral.
High Court connectionWrit for no-notice/arbitrary freeze
Documents normally requiredFreeze memo, statements, KYC, invoices proving clean credits, complaint copy.
LimitationRepresent immediately; PMLA provisional attachment runs up to 180 days (S.5(1)) pending confirmation – referral diary.
Related: PMLA-S.5 referral; UPI/chargeback; aggregator-hold.
Bank says “lien” but no paper?
Demand written lien + set-off working – note drafts.
PMLA Sec 5 provisional attachment — review and counsel referral
ED attaches property/balance alleging proceeds of crime.
What it involvesAccused/associates, bonafide purchasers.
Relevant lawSec 5, 8 PMLA; Adjudicating Authority confirmation.
ForumAdjudicating Authority + Appellate Tribunal – appearance there is referred to counsel who practise before them.
Procedure & stageOrder audit → 180-day confirmation diary → reply-evidence bundle → referral to PMLA counsel; HC writ only for jurisdictional illegality.
RemedyNon-confirmation/release; appeal.
High Court connectionLimited writ; the merits are decided by the Adjudicating Authority and the Tribunal.
Documents normally requiredAttachment order, predicate FIR/charge, title/bank trail, ITR.
LimitationReply before confirmation hearing; appeal to Appellate Tribunal within 45 days of receiving the order (S.26).
Related: Account freeze vs PMLA attachment — triage; SARFAESI enforcement routes.
Can civil/SARFAESI continue over attached asset?
Priority litigated.
CIBIL / credit-report dispute + damages
Closed loan shows overdue; suit-filed/written-off wrongly; loan denied.
What it involvesIndividuals, SMEs.
Relevant lawCIC Act 2005; RBI CIC Directions; consumer/defamation overlay on facts.
ForumBank + CIC (CIBIL/others) → Ombudsman → Consumer Forum/civil + HC writ vs public bank inaction.
Procedure & stageCIBIL report → dispute with closure/NOC/bank statement → 30-day escalation → Ombudsman/consumer + damages working.
RemedyCorrection + compensation on proof; closure-NOC.
High Court connectionWrit vs public bank/CIC inaction
Documents normally requiredReport, NOC/closure, statements, dispute tickets.
LimitationDispute promptly; Ombudsman after the entity's reply or 30 days without one (RB-IOS 2026 also covers credit information companies).
Related: Ombudsman; co-op record error.
Damages automatic?
No – must prove loss/denial + malice/negligence.
RBI Ombudsman (bank deficiency) — complaint draft
Failed UPI, mis-sold insurance, excess charges, closure delay.
What it involvesAccount holders, borrowers.
Relevant lawReserve Bank – Integrated Ombudsman Scheme, 2026 (in force 01.07.2026; replaced RB-IOS 2021, which still governs complaints received before that date).
ForumBank Nodal → Ombudsman (CMS portal).
Procedure & stageWritten complaint to bank → 30-day wait/rejection → Ombudsman with docs + compensation working (scheme caps: consequential loss up to Rs 30 lakh; time/expense/harassment up to Rs 3 lakh – no fixed promise).
RemedyDirection + compensation/cost.
High Court connectionAppeal to Appellate Authority only against an Award, within 30 days of receipt; writ only for jurisdictional error.
Documents normally requiredAccount proof, complaint trail, statements, charge sheets, mis-sale proof.
Limitation30-day bank wait first (or longer RBI/NPCI/card-network timeline); Ombudsman within 90 days after that timeline expires or the bank’s last communication, whichever later.
Related: UPI-chargeback; digital-lending; aggregator-hold.
Ombudsman for private banks?
Yes – all commercial banks are covered; some smaller co-operative banks are not.
UPI / failed-transaction / chargeback
Debited but not credited; fraud-victim reversal; merchant refuses refund.
What it involvesCustomers, small merchants.
Relevant lawRBI UPI procedural circulars + IT Act (phishing) + Ombudsman.
ForumBank → NPCI/bank dispute → cyber cell (1930/NCRP — national financial cyber-fraud helpline) if fraud → Ombudsman.
Procedure & stageUTR/RRN capture → bank dispute within time → TAT-tracked escalation → cyber complaint parallel if fraud → Ombudsman.
RemedyReversal/credit + compensation on deficiency.
High Court connectionWrit only for bank inaction after Ombudsman – rare.
Documents normally requiredUTR, screenshots, statements, complaint numbers.
LimitationDispute within days; TAT 30-day escalation diary.
Related: Digital-lending fraud; freeze triage.
Fraud money recalled?
Only lien-marked balance; spent amount needs investigation.
Payment-aggregator hold (Razorpay/Cashfree etc.)
Rolling reserve / fraud-hold freezes working capital.
What it involvesE-commerce, coaches, agencies.
Relevant lawContract + RBI PA/PG Guidelines; IT Act for fraud credits.
ForumAggregator grievance → bank → civil/Ombudsman (as maintainable) + HC writ only vs bank/public action.
Procedure & stageHold notice + agreement audit (reserve %, T+N, fraud threshold) → KYC/chargeback evidence → release plan + migration.
RemedyPhased release; rolling-reserve reduction; exit with data.
High Court connectionNo writ vs private aggregator ordinarily – civil remedy; writ only if bank freeze without authority.
Documents normally requiredAggregator agreement, hold mails, delivery/refund proofs, chargeback data.
LimitationRespond within hold-notice TAT; else auto-debit/set-off.
Related: UPI; digital-lending.
Sue aggregator in consumer forum?
Depends on consumer vs commercial use.
Digital-lending / app-loan harassment — defence pack
Unlicensed app loan, >36% effective, contact-list shaming, mandate misuse.
What it involvesSmall borrowers, students.
Relevant lawRBI Digital Lending Guidelines (regulated-entity rule); IT Act; harassment punishable under BNS/BNSS + police.
ForumLender grievance → RBI Sachet → police/cyber → civil/Ombudsman + HC writ for police inaction.
Procedure & stageLender-licence check (RBI regulated or LSP) → foreclosure statement demand → harassment evidence bundle → police + RBI complaints → mandate-cancel with bank.
RemedyLawful foreclosure; harassment stop; refund of excess on proof.
High Court connectionWrit for police inaction
Documents normally requiredApp/KFS, disbursement/repayment, mandate, call/chat proofs, bank entries.
LimitationAct before mandate bounce + CIBIL damage; preserve evidence immediately.
Related: CIBIL; freeze triage.
Ignore illegal app loan?
No – pay lawful dues with receipt + complain on excess/harassment.
FAQ
Bank recovery, SARFAESI and DRT papers: common questions
I received a SARFAESI Section 13(2) notice. How long do I have to respond?
The notice gives 60 days to pay. Within those 60 days the borrower can send a written objection under Section 13(3A), and the bank must reply with reasons before it moves to possession. The objection should test the NPA date, the amount claimed and the description of the property.
What is the time limit for a Securitisation Application (SA) under Section 17?
45 days from the Section 13(4) measure, such as the bank taking possession. Any stay application is filed with the SA, not after. The SA papers are prepared here; appearance before the Debts Recovery Tribunal at Ernakulam is by counsel who practise there.
Does negotiating a one-time settlement (OTS) stop the SARFAESI clock?
No. OTS talks do not stop the 45-day period for a Securitisation Application, so the SA is filed while the proposal is negotiated. An OTS letter should set out the amount, payment dates, the default clause, the NOC, the CIBIL update and CERSAI satisfaction.
The bank has published an auction notice for my property. Can the sale still be stopped?
Under Section 13(8), as substituted in 2016, the borrower can stop the sale by tendering the dues with costs before the notice for public auction is published. After that, the sale is tested for defects under Rules 8 and 9 of the Security Interest Rules — for example, the 30 days required between the sale notice and the first sale of immovable property.
I only guaranteed the loan. Can the bank proceed against me under SARFAESI?
SARFAESI applies to a guarantor’s secured asset, and the same 60-day and 45-day clocks run as for the borrower. The guarantee deed is checked for its limit, notice terms and any variation made without the guarantor’s consent, which can matter for discharge under Sections 126 to 139 of the Contract Act.
