Sale of a property by Bank invoking SARFESI is as good as sale made by borrower


Madras High Court in the matter of R. Arumugasamy Vs Authorised officer; Review Petition no. 82 and 83 of 2016 held that where there is more than one property mortgaged with the secured creditor, it is the choice of the secured creditor as to against which property it intends to proceed. A sale made by a secured creditor under Section 13(6) of SARFESI Act is as good as the sale made by the borrower.

DRAT can transfer appeal/ application under Section 17 of the SARFAESI Act from one DRT to another DRT #indianlaws


The issue for discussion before the Court was that the appeal/ application under Section 17 of the SARFAESI Act is maintainable only before the DRT within whose jurisdiction the asset/property with respect to which the petition is filed is located. In view of this the DRAT in exercise of powers under Section 17A of the DRT Act would mean to have no power to transfer the applications under Section 17 of the SARFAESI Act from the DRT within whose jurisdiction the properties with respect to which the applications are filed are situated, to another DRT.

Jurisdiction of Civil Court vis-à-vis Scope of Section 34 of the SARFESI


A Civil Court has no jurisdiction to entertain any suit or proceedings in respect of matters falling under Section 13(4) of the Securitisation Act as such matters comes under the jurisdiction of the DRT and the Appellate Tribunal

Unnecessary adjournments must not be granted by the DRT


Debt Recovery Tribunal(s) are constituted to ensure expeditious disposal of controversies/ issues between the banks and borrowers in the larger public interest.

Mandatory provisions of Security Interest (Enforcement) Rules 2002 can be dispensed in certain conditons


Mandatory Provisions of Rule 9 of Security Interest (Enforcement)  Rules 2002 can be dispensed with when secured creditor, borrower and auction purchaser by a written agreement so agree

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