• Possession under SARFAESI Act

We had participated in an E-auction for purchase of a property(Land) under SARFAESI Act from Punjab National Bank. Though we have paid the entire amount quoted in our bid in the month of September, 2016, we are yet to get the possession of the property from the bank. On our enquiry with the bank, we have been told that the bank authorities have written to the Deputy Commissioner for official demarcation of the property sold to us. It is over five months now and as per the bank, the file is still in the DC's office. 
 In such a scenario, my queries are as under:
 i. Whether the Bank can go ahead with any auction without taking possession of the plot of the land? 
 ii. How long should we wait for the Bank to give us the possession of the plot of the land? In any case, can we claim any compensation for the delay by the bank in handing over the possession of the property to us?
Asked 7 years ago in Property Law
Religion: Hindu

2 answers received in 1 hour.

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8 Answers

1. There is no legal hindrance in selling a property in auction even if it's encumbered with tenants or its physical possession is not taken.

2. You should have been vigilant in ensuring the demarcation or possession before buying the same.

3. In many cases the property is auctioned as is where is basis.

4. However do note that at the time of auction bank committed any misrepresentation of fact.

5. In that event you have legal redress or if there is any wilful inaction on the part of the bank you can file writ petition.

Devajyoti Barman
Advocate, Kolkata
22920 Answers
498 Consultations

5.0 on 5.0

Bank must have taken symbolic possession of plot of land Properties under Bank Auctions are sold on “As is Where is & What is There is Basis” which implies Bank does not take any responsibility regarding Title of the property. You should have done due diligence before making payment.

Ideally bank should take physical possession before auction of property

2) wait for one month or so

3) claim compensation from bank for delay in delivery of possession

Ajay Sethi
Advocate, Mumbai
95205 Answers
7607 Consultations

5.0 on 5.0

Hi.

I am prctising in guwahati , biswanth and tezpur courts. Dc has the power to demarcate the property. Bank has the authority to go for bid without having real posession but in the contract the date to which the particular land will be handed over to you might be mentioned.

You have the right to claim compensation for very such delay.

Shivam Sood
Advocate, Ludhiana
111 Answers
1 Consultation

4.2 on 5.0

1. As per the Judgement passed by Calcutta high court and upheld by the Apex court, the Bank can not issue sale notice under SARFAESI Act unless physical possession of the said property has been taken by the Bank through DM against its application filed u/s 14 of SARFAESI Act,2002.

2. You can file a Writ Petition against the Bank for selling you the property without taking possession of the same and pray for refund of the amount you have paid with interest, damage and cost.

Krishna Kishore Ganguly
Advocate, Kolkata
27245 Answers
726 Consultations

5.0 on 5.0

1. The bank can take symbolic possession and proceed with the e-auction.

2. You have to pressurise the bank for a speedy possession, if there is an inordinate delay you may issue a legal notice to the bank demanding the expeditious possession or to pay compensation till the date of handing over possession.

T Kalaiselvan
Advocate, Vellore
85404 Answers
2236 Consultations

5.0 on 5.0

In any case, can we claim any compensation for the delay by the bank in handing over the possession of the property to us?

Since there is no provision for this you can issue a legal notice to the bank stating that you had faced loss and hardships due to delay in handing over the possession.

Hence you are demanding the compensation for the delay in handing over possession.

T Kalaiselvan
Advocate, Vellore
85404 Answers
2236 Consultations

5.0 on 5.0

We cannot see the answers posted by other lawyers on this website

Hence Mr Ganguly can only furnish citations of the judgment cited by him

Ajay Sethi
Advocate, Mumbai
95205 Answers
7607 Consultations

5.0 on 5.0

Search the Calcutta High Court website. The cases are regarding Debasish Nandy, Swastyan etc.

Krishna Kishore Ganguly
Advocate, Kolkata
27245 Answers
726 Consultations

5.0 on 5.0

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