Illegal demand notice by the bank



My Respected Colleagues

My client borrowed home loan of Rs.7.6 lakhs from the Bank in the year 2007 and had paid the entire sum as scheduled every month for 115 months without any default. The amount fixed in 2007 was Rs.11348/- EMI (Principal + Interest) for 120 months. After repaying of 115 months, last week all of a sudden, my client received bank notice u/s 13 (2) of SARFAESI ACT to auction the property, on which she availed home loan, demanding her to pay Rs.3.7 lakhs. It clearly shows that the bank with an ill intention to drag my client into the legal battle to damage her prestige in the society, failed to issue (1) any information of further developments in the banking (2) harassing my client to pay an unimaginable amount. What action we can take, kindly advise.


Smt.G.P. Srinivas
Advocate - Hyderabad


First inform us which bank. Second loan cetera name with IFSC and MICR. Third loan relationship no. Fourth all per month repayment schedule. If possible make her loan savings account statement Then we can proside.


Mr. Susen Nath

Thanks for your reply. Are you an Advocate / Banker / CA / Financial Analyst.


Smt.G.P. Srinivas Advocate - Hyderabad

Self Employed

Mrs Srinivas, Please let me know which Bank is it ? Section 13(2) is a Demand Notice which is issued only when a borrower becomes Wilfull defaulter and the loan is declared NPA. Plus a Bank can initiate SARFESI act only when the outstanding amount is 1.0 Lakh and above. As such, when you say your client has paid 115 instalments regularly without default and only 5 remaining. Hence the outstanding amount as per the EMI stands around 60 K 

Please Approach the Bank ASAP and get a complete statement. Once you have the statement in hand only then you will be able to ascertain on why the Bank is demanding Rs 3.7 Lakhs and has issued a Demand Notice u/s 13(2). Please do remember that there are stringent guidelines issued for the Banks in matters pertaining to SARFESI Act. Hence it is highly unlikely that Bank plays around with your clients just like that. Gather facts and act.


Thank u srinibash. I am charted consultant and going to complete my law degree.


you can approach consumer forum for adjudication of your case, as your client falls under the defination of consumer.

Retired employee.

There may be misunderstanding in knowing the facts.

On behalf of your client , just meet the manager, clear out the misunderstanding.

There should be demand notices and information before taking such a serious action.

If there is a communication gap , clear it, report it as a complaint to superior, demand for the statement , copy o sanction communication, get the calculations through CA and then come to a logical conclusion.

Bank is having thousands of borrowers and officials can not even do not remember the names, as most of them never come to bank.  Most of the transactions are through ATM and other Computers so the one to one conversation is limited.

The bank has provided a home.  Let us not jumpt into conclusions and find out the gap for such misunderstaning.  Remove the impediment before it spoils to longstanding relationship, that may affect in credit rating.

Expecting another query from Sri GPS questioning on my profession, I was a banker for 30 years and involved with legal matters through a controlling office in financial capital.

Total likes : 1 times


Yes, there could be misunderstanding. Try to sort it out before proceeding further.


Thank you Sir.

G.Padmavathi Srinivas

Retired employee.

The problem is those who followed the guidance must also share as to how they have become successful, as such shared  success story  in open forum not only inspires but also guides those members   who may in future encounter such issues.




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