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Q. Account is npa and possession is taken

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Sahil Goyal

posted 3 years ago

question iconAccount is npa and possession is taken

Sir two properties were loaned and both the properties were npa the value of 1 st property is 65 lakh and second 3 cr and the loan being worth 93 lakh...so can't we save the second property which is three storey building by asking bank to sell the first property completely and second property that is 3 storeyed building floor wise.is their any procedure aur letter we can provide to bank

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ROBERT D ROZARIO

ROBERT D ROZARIO

Responded 3 years ago

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A.How come when the valuation of the first property is INR 65 lakhs and the recoverable outstanding dues is INR 93 lakhs. Since both the property is declare NPA, a proceeding against both the properties will be initiated by 60 days demand notice under the Sarfaesi Act, to discharge dues within the stipulated period mentioned in the notice from the date of receiving the notice. Where the borrower does not discharge dues in full within 60 days, THEN WITHOUT INTERVENTION OF ANY COURT OR TRIBUNAL Secured creditor (bank) may take physical possession i.e. collateral and auction it to recover the debt. In certain cases, it is not feasible for the bank to take physical possession because of XYZ reasons. The secured creditor issues symbolic possession notice and then proceed with the auction based on symbolic possession.

If you have received a 60 days demand notice then you may contact Vidhikarya for allotting a local DRT lawyers. An objection needs to be raised under sub-section (3A) of section 13 of the Act within 60 days time period of such notice and thereafter the bank shall communicate within one week of receipt of such representation or objection the reasons for non-acceptance of the representation or objection to the borrower: You may take your chance by making an offer in such representation of repaying full dues (auction of the first property worth INR 65 lakhs and the remaining balance in liquid assets). This acceptance of your offer is absolutely at the discretion of the bank. If the bank does not accept your offer, and proceed with the take possession of your property of auction, then you may approach firstly DRT by filing a case to stop bank auctioning your properties and if you feel that there is an error in the DRT's decision you may prefer an appeal before DRAT. The limitation period is 45 days and 30 days respectively.

Note: Alternatively you can make an offer to the bank under OTS scheme. However, while entering compromise settlements in NPA accounts, the Bank shall ensure that the Net Present Value (NPV) of the settlement amount should generally not be less than the net present value of the realizable value of securities.

There is another way of impeding the taking of possession or sale by the bank in the event of default, if tenants have been set up and inducted by the borrower after the creation of the mortgage by creating/antedating documents. These Tenants would resist efforts of the Bank to take possession of the property by contending that they cannot be dispossessed except by following due process of law i.e. after a civil suit/eviction petition has been filed in a regular Civil Court/House Rent Control Court and a decree/order of eviction has been passed. Such litigation would take a long time and consequently delay the process of recovery and thereby defeat Sarfaesi Act.

Every case is different from the other and has its own merits and demerits.
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Sahil Goyal

Replied 3 years ago

Thanks for the reply sir ...as for 93 lakh loan the limit was increased by financing second property of 5 cr .can't we ask bank to sell primary property first and sell the second property floor wise as the valuation of second property is much more than balanced amouny

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ROBERT D ROZARIO

Replied 3 years ago

Why don't you engage a lawyer from VIdhikarya.

NO ITS THE DISCRETION OF THE BANK. HOWEVER YOU CAN MAKE A REQUEST TO THE BANK. BANK'S ARE ALWAYS THERE TO HELP ITS CUSTOMERS. BUT ITS ON THE BANK TO ACCEPT OR REFUSE SUCH PROPOSAL.

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Nirmal Chopra

Nirmal Chopra

Responded 3 years ago

A.Bank can recover its money by auction of both loaned properties.
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Sahil Goyal

Replied 3 years ago

Sir can't we ask bank to recover bu selling one property completely and other in parts that is floor wise

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Nirmal Chopra

Replied 3 years ago

It is the discretion of the bank.u can't force the bank.send a written request for the same.

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Deepak Yashwantrao Bade

Deepak Yashwantrao Bade

Responded 3 years ago

A.Sir, now Bank loan recovery is strictly executed. Any bank not taking any excuses about loan recovery. It's highly recoverable monetary matter. Better way to hire best property lawyer and consult with it. You can approach to vidhikarya lawyer for procedurel aspects.
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Sahil Goyal

Replied 3 years ago

Sir can't we ask the bank to recover loan by selling 65 lakh worth property and recover the balance amount by selling 3 storey building floor wise

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