AI Overview...
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Mandatory Notice under Section 13(4) - Several sources emphasize that issuing a notice under Section 13(4) of the SARFAESI Act is a mandatory requirement before proceeding with the sale of mortgaged property. Failure to issue this notice renders the subsequent sale invalid. For instance, Source Shiv Shakti Enterprises VS State Bank of India - Dishonour Of Cheque highlights that possession notices must be served prior to auction, and the absence of individual notices under Rule 8(6) is a clear violation. Similarly, Source Haji Abdul Ghani VS Central Bank of India - Andhra Pradesh and Aruna Web Offset Printers VS Andhra Bank, A Govt of Undertaking, Himayat Nagar Branch - Telangana reaffirm that the exercise of power under Section 13(4) is contingent upon proper prior notice, making it a mandatory procedural step. Shiv Shakti Enterprises VS State Bank of India - Dishonour Of Cheque, Haji Abdul Ghani VS Central Bank of India - Andhra Pradesh, Aruna Web Offset Printers VS Andhra Bank, A Govt of Undertaking, Himayat Nagar Branch - Telangana
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Procedural Compliance and Validity of Sale - The courts consistently hold that notices under Sections 13(2) and 13(4), along with the relevant rules (notably Rule 8(6)), must be strictly followed. Non-compliance, such as issuing a sale notice without prior possession notice, leads to the invalidation of the auction process (Sources Dutta Umamaheswara Rao vs VST Constructions - Andhra Pradesh, A Lokareddy (Loknath Reddy) vs The Authorised Officer, State Bank Of India - Debt Recovery Appellate Tribunal, Munjaji S/o Kondiba Chate VS State Of Maharashtra - Bombay). When notices are not properly served or are omitted, courts have invalidated sales, emphasizing the mandatory nature of these procedural steps. Dutta Umamaheswara Rao vs VST Constructions - Andhra Pradesh, A Lokareddy (Loknath Reddy) vs The Authorised Officer, State Bank Of India - Debt Recovery Appellate Tribunal, Munjaji S/o Kondiba Chate VS State Of Maharashtra - Bombay
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Issuance of Subsequent Notices - When initial notices fail or are not issued, courts have mandated the issuance of fresh notices under Rule 8(6) and Rule 9(1) before conducting a sale, underscoring the mandatory character of these notices for validity (Sources Dutta Umamaheswara Rao vs VST Constructions - Andhra Pradesh, UNION BANK OF INDIA vs Sri Boddu Gnaesh - Debt Recovery Appellate Tribunal, A Lokareddy (Loknath Reddy) vs The Authorised Officer, State Bank Of India - Debt Recovery Appellate Tribunal).
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Legal Interpretation - The legal position is clear: notices under Sections 13(2) and 13(4), and Rules 8(6) and 9(1), are mandatory procedural steps. Non-compliance invalidates the sale, and courts have consistently upheld this view, emphasizing the importance of following statutory procedures strictly. Haji Abdul Ghani VS Central Bank of India - Andhra Pradesh, Aruna Web Offset Printers VS Andhra Bank, A Govt of Undertaking, Himayat Nagar Branch - Telangana, UNION BANK OF INDIA vs Sri Boddu Gnaesh - Debt Recovery Appellate Tribunal
Analysis and Conclusion:
Based on the case law and statutory provisions, issuing a notice under Section 13(4) before initiating sale proceedings under Rule 8(6) is mandatory. The courts have reiterated that failure to serve proper notices at the prescribed stages invalidates the auction process. Therefore, it is legally necessary to issue a notice under Section 13(4) prior to issuing a sale notice under Rule 8(6), ensuring compliance with procedural requirements and safeguarding borrower rights.
Search Results for "It is Mandatory to Issue Notice under Section 13 4 before Issuing Sale Notice under Rule 8 6"
• India - Dishonour Of Cheque
VIKASH JAIN
(6) Proviso—Auction sale of mortgaged property—Possession notice—Notice under Section 13(2) of SARFAESI Act ... being mandatory in nature, was required to be served before SBI could proceed to issue possession notice and take any further action ... for the purpose of auctioning property—No individual notice under Rule 8(6) to borrower was served which is a clear....
2012 0 Supreme(AP) 66 • India - Andhra Pradesh
G.KRISHNA MOHAN REDDY, V.V.S.RAO
After getting the said ad interim injunction vacated first respondent issued possession notice under Section 13(4) of the Act. ... It is well settled that any provision requiring the issue of notice has to be interpreted as mandatory. ... Security Interest Act, 2002 –Rule 8 - Section 13 – Securitization and Reconstruction of Financial Assets ... ... (6) In case the sa....
2025 0 Supreme(AP) 952 • India - IN THE HIGH COURT OF ANDHRA PRADESH AT AMARAVATI
DHIRAJ SINGH THAKUR, RAVI CHEEMALAPATI
(A) SARFAESI Act, 2002 - Sections 13(2), 13(4), 13(8) - Security Interest (Enforcement) Rules, 2002 - Rule 8(6) and Rule 9(1) - Auction ... and Rule 9(1) notice provisions before the auction, thus rendering the sale invalid. ... issue fresh notice after initial attempts failed. ... The bank then issued a possession n....
2012 0 Supreme(Kar) 927 • India - Karnataka
VIKRAMAJIT SEN, B.V.NAGARATHNA
(4) of Section 13 of the Act, the issuance of notice as per sub-rules (1) and (2) of Rule 8 has to be complied with indicating the ... The taking of possession of a secured asset of a borrower under sub-section (4) of Section 13 is a drastic measure and the exercise ... ... Therefore, the issuance of notice in terms of Rule 8 of the Rules ... Issuance of #HL_S....
2020 0 Supreme(Telangana) 67 • India - Telangana
M.S.RAMACHANDRA RAO, K.LAKSHMAN
of Section 13(4) of the Act up to the date of the auction notice i.e , notice dt.05.05.2018 under Rule 8(6) of the Rules published ... of Section 13(4) of the Act up to the date of the auction notice i.e , notice dt.05.05.2018 under Rule 8(6) of the Rules published ... possession notice unde....
2024 Supreme(Online)(DRAT) 278 • India - Debt Recovery Appellate Tribunal
MR. JUSTICE ANIL KUMAR SRIVASTAVA, CJ
(A) SARFAESI Act, 2002 - Section 13(2) and 13(8) - Security Interest (Enforcement) Rules, 2002 - Rules 8(6) and 9(1) - Auction sale ... under Rule 9(1) of the Rules, as per the amended Section 13(8) of the SARFAESI Act. ... of the amended Section 13(8) on the borrower's right of redemption. ... In the present case, admittedly a notice....
2025 Supreme(Online)(DRAT) 227 • India - Debt Recovery Appellate Tribunal
Justice Anil Kumar Srivastava, CJ
without proper notice - Court held that issuance of fresh sale notice under Rule 8(6) and 9(1) is mandatory when the earlier auction ... ... ... Ratio Decidendi: The court ruled that the bank's failure to issue mandatory notices under the SARFAESI Act invalidated the ... conducted by the bank without issuing required notices under the SARFAESI Act after a prior sale#H....
2022 0 Supreme(Guj) 101 • India - Gujarat
ARAVIND KUMAR, ASHUTOSH J. SHASTRI
Rules, 1971 – Chapter 4 - Rule 9, 9(4B)- General Clauses Act - Section 23 - grant of licence - Power of Central Government to make ... Constitution of India, 1950 - Article 14 - Insecticides Act, 1968 - Section 3, 4(2), 5, 9, 9(4) 36 - Insecticides ... by Union of India to contend that urgency clause has been invoked as provided under proviso to Sub-section (1) of Section 36 - However ... The procedure prescribed under Section 36 is....
2020 0 Supreme(Telangana) 747 • India - Telangana
A.RAJASEKHAR REDDY, T.VINOD KUMAR
section 13(2) and the possession notice under Section 13(4) of the Act. ... under section 13(2) and the possession notice under Section 13(4) of the SARFAESI Act. ... Issues: The main issue was whether the respondent bank had complied with the mandatory requirement of issuing the demand notice ... , to the p....
2021 0 Supreme(Bom) 1694 • India - Bombay
M.G.SEWLIKAR
The court finds that the failure to give proper notice, the adjournment of the auction without issuing a fresh proclamation, and ... The court finds that the auction proceedings violated several provisions of the rules, including the requirement to give proper notice ... , the need for a fresh proclamation when the auction is adjourned for more than seven days, and the mandatory deposit of the remainder ... Procedure for attachment and sale of property under section 156.— (11) In the a....
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