ENFORCEMENT OF SECURITY INTEREST UNDER SARFAESI, ACT 2002
(Section 13 to 19 of the Act)
I. Demand Notice under section 13(2) of SARFAESI
ACT
(i)
Requirement for initiation of Demand Notice
(a)
Account should have been classified as NPA
(b)
Documents should not be time barred (Section 36)
(c)
Above 1 lac ceiling (Section 31)
(d)
Total outstanding should be above 20% of total sanction
(Section 31)
(e)
Secured Asset should not be agriculture land (Section
31)
(ii)
Important Contents of 13(2) Notice
A) Advance
details
B) NPA
date
C) As
on date dues payable
D) Details
of Secured asset intended to be enforced
(iii)
Service of Demand Notice
Transmitting or delivering the
13(2) Demand Notice
to borrower including Guarantors
at (i) his Residence or
(ii) place of business or
(iii)
place works for gain
Through
(i)
Registered Post
(ii)
Speed Post
conspicuous
(iii)
Courier
(iv)
Email
(v)
Fax
(iv)
List of
Records to be preserved
1.
Copy of the
13(2) notice sent to all the borrowers including guarantors
2.
Postal receipts
3.
Acknowledgement card or returned cover or print out of
status of delivery
Substituted
Service
4.
Affixture Photo of 13(2) at outer door or any
conspicuous part of the building where borrower resides or his work place
5.
Paper publication (Both Tamil and English)
II. Reply to
Representation or objection raised in response to the 13(2) notice
(Reply should be with in fifteen days from receipt of the notice)
III. Possession under section 13(4) of SARFAESI:
(1) Requirement
for initiation of possession notice
(a) Notice under Section 13(2) should have
completed AND found to be in order.
(b) Sixty days should have completed from the
date of notice
(2) Procedure of taking
possession (Rule 8 (1) & (2) of Security Enforcement Rules, 2002)
1. Delivering
the possession notice to the borrower
2. Affixing the
Possession notice on the outer door or any other conspicuous place of the
secured asset
3. Publishing the possession notice in two
dailies having sufficient circulation
(English
& Vernacular) within seven days after taking possession.
(3) List of Records to be preserved
1.
13(4) Affixture Photograph with authorized officer
2.
Postal receipts
3.
Acknowledgement card or personal acknowledgement on the
copy of the possession notice or postal delivery status print out
4.
Copy of the paper publications (Vernacular and English)
(4) Remedies available to the borrowers (Section 17)
Borrower or Guarantor
or any other person (Tenant or person who is disputing title ) may approach the
DRT against the possession notice by filing SA under Section 17 of SARFAESI Act
within 45 days from the date of possession.
IIIa. Physical
Possession (Section 14)
(i)
Filing an application before Chief Materopolitan
Magistrate or District Magistrate to assist Authorised Officer to take physical
possession of the property.
(2) Application
should be filed before CMM if the property situated within CMM jurisdiction
otherwise to be filed before District Magistrate ie The Collector of concern
District.
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