Back
M. S. RAMACHANDRA RAO, JASJIT SINGH BEDI
Vijay Madan – Appellant
Versus
Punjab National Bank – Respondent
JUDGMENT
M.S. Ramachandra Rao, J. - Background facts
2. Petitioner No.1 is one of the partners of the firm i.e. M/s S.L.N. Industries (hereinafter referred to as "Firm") and petitioners No.2 and 3 are Gurantors/Mortgagors to the loan taken by the said Firm from the Punjab National Bank (Respondents No.1 to 3).
3. The Firm had availed a Cash Credit Limit of Rs. 1 Crore from respondents No.1 to 3-Bank on 08.07.2009 on certain terms and conditions against the hypothecation of goods, which was further secured by the personal guarantee of the petitioners No.2 and 3 who also created equitable mortgage on their House No. 254, Sector 16-A, Faridabad.
4. Proceedings under the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (hereinafter referred to "the Act of 2002") were initiated by the Bank against the Firm and the petitioners through a notice dt.04.01.2013 issued under Section 13(2) of the Act of 2002 demanding Rs. 1,03,19,739.73 paise outstanding as on 31.12.2012.
5. Thereafter, symbolic possession of the residential house of the petitioners No.2 and 3 was taken by the Bank on 13.03.2013.
6. The said action of the Bank was questioned by the
The main legal point established in the judgment is the mandatory requirement of a 15-day notice for subsequent sales under Rule 9(1) of the SARFAESI Act and the importance of clear notice to the bor....
Secured creditors must adhere to proper notice and valuation requirements per the SARFAESI Act, as failure to do so invalidates asset sales.
It is mandatory for the Secured Creditor/Bank to effect personal service of the sale notice, apart from publication as provided under Rule 8 & 9 of the Security Interest (Enforcement) Rules, 2002.
Point of Law : Provisions of section 13(8) of Act gave power to borrower to redeem property till last minute before sale takes place.
An indispensable Tool for Legal Professionals, Endorsed by Various High Court and Judicial Officers
Please visit our Training & Support
Center or Contact Us for assistance
Scan Me!
India’s Legal research and Law Firm App, Download now!
For Daily Legal Updates, Join us on :
Back to top
