Category: SARFAESI

Security Interest (Enforcement) Rules, 2002 – Rule 9(5) – Contract Act, 1872 – Sections 73 and 74 – Forfeiture of earnest-money deposit by the secured creditor – Constitutional validity of Rule 9(5) of the SARFAESI Rules is upheld – Any dilution of the forfeiture provided under Rule 9(5) of the SARFAESI Rules would result in the entire auction process under the SARFAESI Act being set at naught by mischievous auction purchaser(s) through sham bids, thereby undermining the overall object of the SARFAESI Act of promoting financial stability, reducing NPAs and fostering a more efficient and streamlined mechanism for recovery of bad debts

SUPREME COURT OF INDIA FULL BENCH THE AUTHORISED OFFICER, CENTRAL BANK OF INDIA — Appellant Vs. SHANMUGAVELU — Respondent ( Before : Dr. Dhananjaya Y. Chandrachud, CJI., J.B. Pardiwala and…

(SARFAESI) – Section 13(8) – Transfer of Property Act, 1882 – Section 60 – Redemption of mortgage – Failure on the part of the borrower in tendering the entire dues including the charges, interest, costs etc. before the publication of the auction notice as required by Section 13(8) of the SARFAESI Act, would also sufficiently constitute extinguishment of right of redemption of mortgage

SUPREME COURT OF INDIA DIVISION BENCH CELIR LLP — Appellant Vs. BAFNA MOTORS (MUMBAI) PVT. LTD. AND OTHERS — Respondent ( Before : Dr. Dhananjaya Y. Chandrachud, CJI. and J.B.…

Limitation Act, 1963 – Section 18 – Effect of acknowledgment in writing – Documents relating to acknowledgement claiming benefit of Section 18 were introduced at appellate stage, and such documents being balance sheets and settlement offers, the same could be accepted even at the appellate stage.

SUPREME COURT OF INDIA DIVISION BENCH AXIS BANK LIMITED — Appellant Vs. NAREN SHETH AND ANOTHER — Respondent ( Before : Vikram Nath and Ahsanuddin Amanullah, JJ. ) Civil Appeal…

HELD the enactment of section 142A of the Customs Act does confer or create a first charge on the dues ‘payable’ under the Customs Act, notwithstanding provisions under any Central Act, but not in cases covered under Section 529A of the Companies Act, Recovery of Debts Due to Banks and the Financial Institutions Act, 1993, Securitisation and Reconstruction of Financial Assets and the Enforcement of Security Interest Act, 2002 and the Insolvency and Bankruptcy Code, 201

SUPREME COURT OF INDIA DIVISION BENCH INDUSTRIAL DEVELOPMENT BANK OF INDIA (THROUGH STRESSED ASSETS STABILIZATION FUND CONSTITUTED BY THE GOVERNMENT OF INDIA) — Appellant Vs. SUPERINTENDENT OF CENTRAL EXCISE AND…

HELD on SARFESAI writs to High courts – – When a statute prescribes a particular mode, an attempt to circumvent shall not be encouraged by a writ court. A litigant cannot avoid the noncompliance of approaching the Tribunal which requires the prescription of fees and use the constitutional remedy as an alternative.

SUPREME COURT OF INDIA DIVISION BENCH M/S. SOUTH INDIAN BANK LTD. AND OTHERS — Appellant Vs. NAVEEN MATHEW PHILIP AND ANOTHER ETC. ETC. — Respondent ( Before : Sanjiv Khanna…

SARFESAI Act, 2002 – Section 13(2) – If someone has been called upon to participate in the bidding process, the facts must be made clear to the parties for the reason that there is always a high variance between market realizable value and the distress value of the mortgaged property when put to public auction under the provisions of the Act, 2002.

SUPREME COURT OF INDIA DIVISION BENCH MOHD. SHARIQ — Appellant Vs. PUNJAB NATIONAL BANK AND OTHERS — Respondent ( Before : Ajay Rastogi and Bela M. Trivedi, JJ. ) Civil…

(SARFAESI) – Section 31(i) – Possession and Auction – – once the secured property is put as a security by way of mortgage etc. meaning thereby the same was not treated as agricultural land, such properties cannot be said to be exempted from the provisions of the SARFAESI Act under Section 31(i) of the SARFAESI Act – the borrower to prove that the secured properties were agricultural lands and actually being used as agricultural lands

SUPREME COURT OF INDIA DIVISION BENCH K. SREEDHAR — Appellant Vs. M/S RAUS CONSTRUCTIONS PVT. LTD. AND OTHERS — Respondent ( Before : M.R. Shah and M.M. Sundresh, JJ. )…

HELD the borrower can take the benefit of the amount received by the creditor in an auction sale only if he unequivocally accepts the sale. In a case where the borrower also challenges the auction sale and does not accept the same and also challenges the steps taken under Section 13(2)/13(4) of the SARFAESI Act with respect to secured assets, the borrower has to deposit 50% of the amount claimed by the secured creditor along with interest as per section 2(g) of the Act 1993 and as per section 2(g), “debt” means any liability inclusive of interest which is claimed as due from any person.

SUPREME COURT OF INDIA DIVISION BENCH M/S SIDHA NEELKANTH PAPER INDUSTRIES PRIVATE LIMITED AND ANOTHER — Appellant Vs. PRUDENT ARC LIMITED AND OTHERS — Respondent ( Before : M.R. Shah…

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