Supreme Court gave a blow to the borrowers, cannot stop the auction of property
supreme court decision: Today many people take loan from the bank. To take the loan, many people mortgage their property with the bank. Many times, in case of non-payment of the loan, the bank declares the loan taker as default and after that the process of auctioning the mortgaged property starts to recover the loan. When a similar case came before the Supreme Court, the court gave this decision. Let us know what is the whole matter
HR Mandi Bhav News, New Delhi: Recently, a case regarding mortgage of property came to the Supreme Court and the Supreme Court in its decision on Thursday said that a loan taker cannot 'at any time' 'The lender cannot be allowed to stop the mortgaged property from being auctioned by the financial institutions after paying the dues.
The top court said that if a borrower fails to repay the dues of the financial institutions before the publication of the auction notice under the law governing recovery of non-performing assets (NPAs), he cannot request for redemption of his mortgaged property. Could.
Highlighting the sanctity of the auction process, a bench of Chief Justice DY Chandrachud and Justice JB Pardiwala said, 'It is the duty of the courts to protect the sanctity of the auctions held in the past.
The courts should refrain from interfering in the auction, otherwise it would defeat the very purpose of the auction and hamper public trust and participation in it. The top court was dealing with a provision of the Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (SARFAESI Act).
Justice Pardiwala wrote the 111-page judgment
Section 13(8) of the Act provides that no debtor shall, before the date of publication of the notice for public auction or inviting tender for transfer by way of lease or sale of the mortgaged properties One can demand back his mortgaged property from the financial institutions at any time by first paying the entire due amount. Justice Pardiwala wrote a 111-page judgment on behalf of the bench.
He said in it, 'We believe that as per the amended section 13(8) of the SARFAESI Act, once the borrower pays the full amount of the outstanding amount along with charges and fees to the lender before the publication of the auction notice.
If he fails to do so, as per Rule 8 of the 2002 Rules, his right to redeem his mortgaged property will lapse on the date of publication of the auction notice in the newspaper.
This decision came on the appeal of Sellir LLP challenging the order of the Bombay High Court. The High Court had allowed another company, Bafna Motors (Mumbai) Private Limited, to redeem its mortgaged property on payment of dues to the bank.