Npa

Querist : Anonymous (Querist) 11 December 2011 This query is : Resolved
What happens when a company who has taken working capital loan from a nationalised bank against a collateral securities worth 60% of the working capital loan amount, is unable to service tha same? The directors have given their personal guarantee. Can bank also ask for director's wife's property which is in her name and she is not holding any position in the company, neither she is guarantor? What proceduers bank has to follow and how much time they can give us, if company can show reasonableness to pay the same?

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Raj Kumar Makkad (Expert) 11 December 2011
Bank cannot ask for the personal assets of wife of such defaulting directors under any law as they do not hold any post in the company. Bank can approach to DRT and can get the properties of directors auctioned.

Devajyoti Barman (Expert) 11 December 2011
Bank can not certainly ask for property details of the Direcotr's wife when some sort of personal guarantee is already given.

mahendrakumar (Expert) 12 December 2011
regarding time for repayment,negotiate with the banks,depending on the amount and the circumstances,banks do entertain such pleas.

prabhakar singh (Expert) 12 December 2011
It is true that if Bank decides to proceed to realize the debt on the ground of NPA of the a/c then it can not proceed against the properties of wife.

But in case a fresh arrangement is sought for paying the loan the bank may demand additional guarantee to secure.

The next reason may be to ascertain what properties in wife's name just now stand and what are the sources of income so that if director make properties from their own fund as Benami in wife's name the same be taken hold of by banker.

Guest (Expert) 12 December 2011
Director's Wife has no concern with the company's assets and liabilities, even if director has given personal guarantee on loans of the company, provided the director has also not bound his heirs while signing the guaranee bond. That aspect must be verified, as normally nobody tries to check that aspect while signing a bond with the bank/financial institutions.

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