Non banking Assets
4 months ago
in banking for reduce NPA (non performing assets) under SARFAESI Act convert some possession property into Non banking assets. now can we resale this property to same borrower whose this property.
A.Dear Sir,
If no charge is created by the Bankers on your such property then with or without banking consent you can sell the property.
If no charge is created by the Bankers on your such property then with or without banking consent you can sell the property.
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A.Dear Client,
When a borrower is unable to repay the amount of the loan in cash and in place of that offers an asset to the bank. This is known as a non-banking asset. Non- Banking Assets, therefore, are those Financial Assets acquired by the banks to settle their debts. When a borrower is unable to repay the amount of the loan in cash and in place of that offers an asset to the bank. This one is provided apart from the asset already given as collateral security to the bank to purchase to settle their dues. When the banks purchase these assets, they are known as non-banking assets. Section 9 of the Banking Regulation Act, 1949 provides for the Disposal of non-banking assets. Under section 9 of the Act Notwithstanding anything found in section 6, no banking company shall possess, for any period exceeding seven years from the date of acquisition or commencement of that act, any immovable property of any kind obtained, except as necessary for its use, whichever is later or for an extension of the period provided for in this section. Such property shall, as the case may be, be disposed of during that period or an extended period: Provided that the banking company can, within the previous seven years, deal or trade in any such property to facilitate its Disposal. In Punjab National Bank Ltd. Vs. Commissioner of Income-tax, Delhi I, 1983 Delhi High Court observed that a reasonable construction of section 9 of the act would be that a banking company can acquire immovable property for its use. but if there is any other portion left, the section does not state that that portion can not be let out. And if a portion is let out to a tenant, it will be for use by the bank, and under this clause, there would be no question of selling the same. The provision applies only in cases where a bank acquires a building otherwise than for its use. So, in view of the above provisions of governing law and court rulings, non-banking assets are disposed of by the Bank.
When a borrower is unable to repay the amount of the loan in cash and in place of that offers an asset to the bank. This is known as a non-banking asset. Non- Banking Assets, therefore, are those Financial Assets acquired by the banks to settle their debts. When a borrower is unable to repay the amount of the loan in cash and in place of that offers an asset to the bank. This one is provided apart from the asset already given as collateral security to the bank to purchase to settle their dues. When the banks purchase these assets, they are known as non-banking assets. Section 9 of the Banking Regulation Act, 1949 provides for the Disposal of non-banking assets. Under section 9 of the Act Notwithstanding anything found in section 6, no banking company shall possess, for any period exceeding seven years from the date of acquisition or commencement of that act, any immovable property of any kind obtained, except as necessary for its use, whichever is later or for an extension of the period provided for in this section. Such property shall, as the case may be, be disposed of during that period or an extended period: Provided that the banking company can, within the previous seven years, deal or trade in any such property to facilitate its Disposal. In Punjab National Bank Ltd. Vs. Commissioner of Income-tax, Delhi I, 1983 Delhi High Court observed that a reasonable construction of section 9 of the act would be that a banking company can acquire immovable property for its use. but if there is any other portion left, the section does not state that that portion can not be let out. And if a portion is let out to a tenant, it will be for use by the bank, and under this clause, there would be no question of selling the same. The provision applies only in cases where a bank acquires a building otherwise than for its use. So, in view of the above provisions of governing law and court rulings, non-banking assets are disposed of by the Bank.
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A.Dear Client,
The process of converting possession of a property under the SARFAESI Act into Non-Performing Assets (NPAs) and subsequent resale to the same borrower involves intricate legal and regulatory considerations. While the SARFAESI Act empowers banks to take possession of assets upon default and sell them to recover outstanding dues, the specifics of resale to the same borrower can be complex. It's crucial to thoroughly review the SARFAESI Act, banking regulations, and legal precedents to ensure compliance with all applicable laws. Engaging legal counsel with expertise in banking and SARFAESI matters would be prudent to navigate the complexities involved. Transparency in communication with the borrower about the process and adherence to legal procedures are essential to mitigate potential disputes. It's advisable to consult with legal professionals who can provide tailored advice based on the specific details of your situation.
Thankyou
The process of converting possession of a property under the SARFAESI Act into Non-Performing Assets (NPAs) and subsequent resale to the same borrower involves intricate legal and regulatory considerations. While the SARFAESI Act empowers banks to take possession of assets upon default and sell them to recover outstanding dues, the specifics of resale to the same borrower can be complex. It's crucial to thoroughly review the SARFAESI Act, banking regulations, and legal precedents to ensure compliance with all applicable laws. Engaging legal counsel with expertise in banking and SARFAESI matters would be prudent to navigate the complexities involved. Transparency in communication with the borrower about the process and adherence to legal procedures are essential to mitigate potential disputes. It's advisable to consult with legal professionals who can provide tailored advice based on the specific details of your situation.
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