• NPA Sarfaesi stop bank auction

My father's company was declared NPA by bank and we have filed a case in DRT to stop bank auctioning our properties. DRT asked us to pay some money in 10 days and gave some time to pay the remaining balance. We paid the initial installment as given in the DRT order. We have collateral securities worth more than the Loan amount and we are ready to sell some of them to clear off the loans. We are not getting any buyer due to Demonetisation effect. We asked the bank to give us an option to sell individual assets to clear the loan. we have filed a case against this in High court but they didn't give a favorable judgement. Our next hearing in DRT will be in march first week. I know DRT will always be in favor of Bank. What are our options now to prevent bank from Auctioning our assets? We also have enough money to pay the amount for our house which is one of collateral security but bank is not willing release the house. How can we stop bank from auctioning our house? We are willing to pay the bank estimated value of the house. Is there any way we can fight this in DRAT?
Asked 7 years ago in Civil Law

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4 Answers

1. There is no need for permission to sell individual assets. If you sell your own properties and pay off the debt then the action of the bank would be averted.

2. So arrange your private resources and inform the court that you have arranged money and is ready to clear the loan. Once the court is convinced it will grant stay and allow you to make the payments.

3. In this manner only the auction would be stopped.

4. Unless you come up with prima facie evidence of having money and genuine willingness to make the payment you can not stop auction.

Devajyoti Barman
Advocate, Kolkata
22920 Answers
498 Consultations

5.0 on 5.0

Your wife has no locus in the proceeding.

Rather give the money to the borrower and let him offer the same to clear the debt.

Once that is done the auction would be stopped.

Devajyoti Barman
Advocate, Kolkata
22920 Answers
498 Consultations

5.0 on 5.0

1) make an offer to the bank under OTS scheme

2) along with said offer enclose cheque for 20 per cent down payment

3) offer to pay balance amount in EMI instalments

4) seek stay of auction till bank decides on your offer

5) in OTS scheme request bank to permit sale of collateral security and sale proceeds being deposited in the DRT which can be adjusted against bank dues

Ajay Sethi
Advocate, Mumbai
95208 Answers
7610 Consultations

5.0 on 5.0

If you are aggrieved by the DRT's decision and feel that there is an error in the DRT's decision, you may prefer an appeal before DRAT.

The highest bidder will be allotted with the property being bid, hence bank cannot allot the property to the lowest bidder.

The bank would go for e-auction, you may quote your bidding amount to acquire the property.

It would not be proper for bank to receive money for one property alone to release it and auction other properties for recovery of the loan amount.

If you find any irregularity or biased attitude of the bank authorities in recovering the amount or auctioning the property, you may bring this to the knowledge of the top management of the bank.

T Kalaiselvan
Advocate, Vellore
85409 Answers
2237 Consultations

5.0 on 5.0

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