The uploaded judgment in Bank Showcause Notice Challenged- HighCourt Chandigarh (Rakesh Nayyar v. The State Bank of India and Others) concerns the legal procedure banks must follow before classifying a borrower’s loan account as “fraud” and reporting the borrower or company directors to the Reserve Bank of India. Borrowers can challenge a bank’s show-cause notice … Read more
Guarantor Liability Is Immediate: Creditor Need Not First Exhaust Remedies Against the Borrower A recent judgment of the Allahabad High Court, Lucknow Bench, has reaffirmed an important principle concerning the liability of a guarantor for repayment of a borrower’s loan. The Court held that, unless the contract of guarantee provides otherwise, the liability of the … Read more
Why SARFAESI Auction Sale Must Be Conducted Fairly and Transparently for fostering Confidence in the SARFAESI framework depends upon balancing recovery rights with procedural justice. Recovery proceedings under the SARFAESI Act frequently culminate in public auctions of secured assets. A recent matter before the Debt Recovery Tribunal, Chandigarh, once again highlights the importance of transparency, … Read more
Post covers DRT Sale Certificate Stamp Duty Case where Debt Recovery Tribunal (DRT) in a public auction, stamp duty on the sale certificate cannot automatically be calculated on the prevailing market value of the property. Instead, the Court emphasized that the auction price realized through a transparent and competitive bidding process carries substantial relevance in … Read more
SARFAESI Limitation: DRT Chandigarh Dismisses Borrower’s Challenge as Time-Barred. The Debts Recovery Tribunal (DRT-III), Chandigarh recently reaffirmed an important principle under the SARFAESI Act, 2002: a challenge to recovery measures must be filed within the statutory limitation period of 45 days. The case involved borrowers who sought to challenge actions taken by a secured creditor … Read more
Blog post based on Bank Possession Section 14, the Madhya Pradesh High Court judgment: Is Section 14 of the SARFAESI Act Mandatory Before a Bank Takes Possession of a Secured Asset? In a significant judgment concerning the enforcement powers of banks and financial institutions under the SARFAESI Act, 2002, the Madhya Pradesh High Court has … Read more
DRT Sets Aside SARFAESI Proceedings After Declaring MSME Loan Account NPA Classification Illegal. The Tribunal quashed the entire recovery proceedings, including auction and possession actions initiated by the bank. In a significant ruling dated 03 March 2026, the Debts Recovery Tribunal (DRT), Chandigarh held that: SARFAESI proceedings initiated against an MSME borrower were illegal because … Read more
In DRT cases, if an auction sale is set aside due to irregularities, legal flaws, or bank default, the auction purchaser is entitled to a full refund of the deposited amount, often with interest (typically 12-15% p.a. or fixed deposit rates). Purchasers can approach the DRT under Section 17 of the SARFAESI Act to claim … Read more
Under the SARFAESI Act, 2002, a mandatory 30-day notice must be served to the borrower before an auction, as per rule 8(6) of the Security Interest (Enforcement) Rules, 2002. Failure to serve this notice violates statutory requirements, often rendering the auction void. Borrowers can appeal DRT decisions to the DRAT within 30–45 days. In this post we will … Read more
In this post we will discuss about a case wherein the the petitioner had obtained a house loan of Rs. 37 lakhs. Subsequently, on account of default in payment, a notice under Section 13(2)of the SARFAESI Act was issued demanding from the petitioner the defaulted amount. Proceedings under SARFAESI Act starts when borrower defaults 3 … Read more
In this post we will talk about the procedure for auction of property by bank if the borrower fails to pay his debt. The SARFAESI Act applies to loans above Rs. 1 lakh that are classified as NPAs. It excludes loans where more than 80% has been repaid and certain types of assets like agricultural … Read more
In this post we will discuss about the the deposit amount under section 21 of Recovery of Debts due to Banks and Financial Institutions Act, 1993 fo filing an appeal in Debt Recovery Appellate Tribunal. Supreme Court already has held that Borrower Has To Pre-Deposit 50% Of The “Debt Due” In Appeal Under Section 18 … Read more
Jurisdiction of Indian courts is decided based on subject matter, territorial limits, and pecuniary (monetary) value, as defined by the Constitution and procedural codes like CPC (civil) and CrPC (criminal). Civil courts are generally determined by where the cause of action arises or the defendant resides, while criminal courts are determined by where the offense was committed. … Read more
The Corporate Insolvency Resolution Process (CIRP) is a time-bound legal mechanism under India’s Insolvency and Bankruptcy Code (IBC) for resolving financially distressed companies, aiming to revive them through restructuring or orderly liquidation to repay creditors. Initiated by creditors or the company itself via the National Company Law Tribunal (NCLT), it involves appointing a Resolution Professional … Read more
You generally cannot file a writ petition directly against Debt Recovery Tribunal (DRT) orders because the statutory appeal to the Debt Recovery Appellate Tribunal (DRAT) under SARFAESI Act (Section 18) or RDDB Act is the primary remedy, but High Courts might entertain a writ in exceptional cases of fraud, manifest injustice, or where remedies are exhausted/ineffective, though Supreme Court … Read more
Pre-deposit in DRT appeals (Debts Recovery Tribunal) under the SARFAESI Act generally requires depositing 50% of the debt due, as claimed or determined, to file an appeal with the Appellate Tribunal (DRAT), but recent Supreme Court rulings clarify this isn’t mandatory for procedural orders; only substantive orders (like final liability) attract the deposit, and no pre-deposit is needed if … Read more
A “Redemption DRAT Appeal” refers to a borrower’s appeal to the Debt Recovery Appellate Tribunal (DRAT) challenging a Debt Recovery Tribunal (DRT) order, often related to their right to “redeem” mortgaged property under the SARFAESI Act, usually involving strict timelines (30-45 days) and depositing a percentage (often 50%, sometimes reduced to 25%) of the debt as a pre-condition, with … Read more
To get possession back after a securitization action (SARFAESI), borrowers file an application (Securitisation Application, or SA) under Section 17 of the SARFAESI Act before the Debt Recovery Tribunal (DRT), challenging the bank’s measures, with powers including restoration if the borrower loses possession unlawfully. However, the DRT can only restore possession to the actual borrower or someone holding … Read more
Post covers CONDONATION OF DELAY PETITION IN DRT CHANDIGARH. However, the court’s decision to condone a delay is discretionary and can be based on a number of factors, including negligence or failure to exercise due diligence. A Debt Recovery Tribunal (DRT) has the power to condone a delay in filing a petition by invoking Section … Read more
Post covers Whether DRT or High Court Chandigarh for Payment Default (NPA) when declared by bank and later Sarfaesi Notice and physical possession of the property is taken. With the ever growing economy of our country, borrowings from banks and financial institutions have also been increasing and have more and more complicated , with the … Read more
This post answers Can Banks attach Agricultural Land DRT Chandigarh Bench but the burden is upon the borrower to prove that the secured properties are agricultural lands and actually being used as agricultural lands and/or agricultural activities. A security interest is a type of lien or enforceable claim created on collateral, usually to obtain a … Read more
Post covers DRT Chandigarh Case Process Procedure where banking lawyers elaborate how to file OA/SA petition before DRT 1, DRT 2, DRT 3 Chandigarh. Debt Recovery Tribunal Chandigarh was made with the purpose of recovering debt from NPA’s declared under RBI Guidelines. The SARFAESI Act procedure allows banks to recover NPAs by seizing and selling … Read more
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