• NPA (non performing asset), travel & POA

Hello,
Bank has filed NPA (non performing asset) against a factory under which I along with my 2 brothers & our mom had taken loan against. 
I along with my wife live/work outside India and only I am planning to travel to India to resolve this matter. After I arrive in India could I under any circumstance be allowed not to leave India under this case?

We are planning to gift whatever asset we have under my wife and my brothers wives (all of whom are not under the loan) after which we will sell the assets and pay the loan. My wife will fill POA so that her part of the gift will be under her mom's name who lives in India. 
Is this legally possible to do? If so please advise the proper steps. 

Thank you.
Asked 1 year ago in Property Law from United States
Religion: Hindu
1. Unless there is a warrant to arrest you issued by a court in India you will not face any hassles in flying out of India.

2. If the proceedings for recovery have been initiated by the bank you can opt to contest the case and also file for settlement in accordance with the law. The mere initiation of proceedings for recovery does not result in a warrant being issued against the borrower. The warrant will be issued only if you dishonour the legal process by not filing your appearance in the court, or not appearing in the court, as the case may be.

3. Your wife can execute a GPA to authorize anyone to sell her share in the gifted property. 
Ashish Davessar
Advocate, Jaipur
18088 Answers
448 Consultations
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1. The bank can auction the property and apply the sale proceeds towards the amount you are liable to pay to it.

2. If the asset is declared as NPA it can file a lawsuit to recover the amount from you whereupon the court may order you to pay the loan with interest, failing which you may be lodged in jail.
Ashish Davessar
Advocate, Jaipur
18088 Answers
448 Consultations
5.0 on 5.0
1) bank has only declared loan NPA 

2) as on date no criminal complaint has been filed by the bank . no summons served  upon you 

3) you would be free to travel outside india . if you default bank will take recovery proceedings . it is a civil case and not criminal one 

4) you can repay the loan by selling off your other properties which are not mortgaged to the bank 

5) your wife can execute POA in favour of her mother . but said POA for sale of property has to be registered 
Ajay Sethi
Advocate, Mumbai
23206 Answers
1218 Consultations
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1) GPA is general power of attorney . rather than executing GPA your wife can give specific power of attorney to her mother for sale of properties mentioned  therein 

2) Bank will issue legal notice to the owners of factory for repayment of loan 

3) if you fail to repay inspite of notice bank may see to auction properties belonging to factory and mortgaged to it to recover the loan  amount 
Ajay Sethi
Advocate, Mumbai
23206 Answers
1218 Consultations
5.0 on 5.0
1. The account  aganst which you had availed Bank loan has been classified as NPA by the Bank,

2. It is not a criminal matter at all for which you will be restrained from returning to your place of employment abroad,

3. You can very well come to India, sell off all your non-mortgaged properties and pay off the outstanding dues of the Bank and get your mortgaged property released,

4. However, you can directly sell off the properties lying in the names of your and your brother's wives without gifting the same to your mother.
Krishna Kishore Ganguly
Advocate, Kolkata
12104 Answers
230 Consultations
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1. Bank will nor issue Demand notice u/s 13(2) of SARFAESI Actasking you to pay the dues with in 60 days and if you do not pay, it will issued Possession Notice u/s13(4) of the Act to take possession of your mortgaged property to sell and realise the dues,

2. If the consideration received after the said sale is more than the dues then the Bank will refund you the said excess amount,

3. If the consideration is inadequate to satisfy the dues, they will file Original Application under Recovery of Debts Due to Banks and financial Institutions Act, 1993 before the DRT praying for direction to attach all other properties of yours which are not mortgaged with the Bank and DRT will finally arrange to sell off the said properties to recover the Bank's dues.
Krishna Kishore Ganguly
Advocate, Kolkata
12104 Answers
230 Consultations
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Transferring a property by the owner to another person through POA or GPA is not valid  and will not confer title to the POA agent.
If the property is pledged for loan, it cannot be transacted as well.
Though you are visiting India  for this purpose alone, even if it does not materializes, it will not hold you back in India, this is a property issue for recovery of loan with interest by the bankers and not a criminal cheating offence or case.
If the loan is under default, the bank may initiate process for recovery under the provisions of saresi act. 
T Kalaiselvan
Advocate, Vellore
13985 Answers
127 Consultations
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Don’t be panic at this stage. Present stage the bank not filed a case against the borrower or granter’s .More over it is not a criminal matter. It is purely civil. The borrower or granter’s can get time for repayment.

More over if the loan is under default, the bank may initiate process for recovery under the provisions of SARFAESI act and may file Application under Recovery of Debts Due to Banks and financial Institutions Act, 1993 before the DRT.   You can get enough time to pay the debts. 

A power of attorney authorizes another person, referred to as your attorney-in-fact, to act for you, the principal, when you are unable, unwilling or incapable of acting on your own. The power can apply to a particular transaction or under a widespread host of circumstances. The type of power of attorney you execute will govern the types of transactions covered by it and often the time period during which it may be used.

A general power of attorney gives broad authorizations to the agent. The agent may be able to make medical decisions, legal choices, or financial or business decisions. A special power of attorney narrows what choices the agent can make. You can even make several different POAs, with different agents for each.

Ajay N S
Advocate, Ernakulam
1915 Answers
19 Consultations
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