SARFAESI Act

Querist : Anonymous (Querist) 02 April 2011 This query is : Resolved
Respected expert,
I take loan amount of Rs.30000/- for Micro Financial Institution.and since 3 months I am defaulting in depositing the interest.

Now my query is that the financial institution has power to take action against me as per the provisions of SARFAESI ACT.2002.???
i.e. what is the minimum loan amount that attract the provision of SARFAESI Act.

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Kirti Kar Tripathi (Expert) 02 April 2011
No, this Act is applicable when amount due is more then 10 lac.

M.Sheik Mohammed Ali (Expert) 02 April 2011
yes, very good explanation and answer

Querist : Anonymous (Querist) 02 April 2011
@Kirti Kar Tripathi
Thank's for reply sir,

again sir could you provide some some knowledge on how the Micro Financial Institution realized their loan amount back from defaulter.Is there any specific law on that by parliament.

DEFENSE ADVOCATE.-firmaction@g (Expert) 02 April 2011
Pl check up the limit is reduced from ten lacs to two lacs.

For defaulters there are many legal actions possible, why you do not want to repay.

RAJU O.F., (Expert) 02 April 2011
Banks & FIs can invoke SARFAESI Act if the due is more than Re.One lakh and if the account is NPA. NOT RS.TEN LAKHS. Hence,for your Rs.30,000/-loan, the bank can add interests and charges and make it more than one lakh, so as to invoke SARFAESI. Any how taking loans and making it defaulted is not at all advisable.