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Sarfaesi

(Querist) 11 November 2013 This query is : Resolved 
my cleints ,a bank had hired a custodian to property after 13(4) possession. can dispute to any clause of agreement open doors of civil litigation completely or shadow of section 17 sarfaesi will be applicable. cant i use assistance offered under section 14 to get these people out forcibly?......cant a custodian be treated at par with a tenant on a secured property after breach of agreement. is there a way out?
Devajyoti Barman (Expert) 11 November 2013
civil court's jurisdiction is completely barred.
Read the latest decision of SC passed only few days back.
Ritika singh (Querist) 11 November 2013
dear sir
i have perused the judgements being mostly tenancy related with section 35 of sarfaesi prevailing over local land laws. here however i have a custodian agreement with my agent with a clause for repossession of secured assets . RBI catagorically mentions in its circular that all such clauses ahall follow indian contract act in letter and spirit. how is civil litigation barred ?
Raj Kumar Makkad (Expert) 12 November 2013
There is specific clause in SARFAESI Act to that effect and otherwise also special act prevails over the general act.
Rajendra K Goyal (Expert) 12 November 2013
Agree with the expert raj kumar makkad ji, nothing more to add.
Murali Krishna (Expert) 12 November 2013
Under the Act, Bank has two options. One is acquiring the property directly by approaching Magistrate ( for assistance to obtain possession of property) and another by moving through Custodian. Being creditor, Bank has taken the decision, may be to be more careful to void any other repercussions. Further, appeal against such order lies only before appellate tribunal under the Act.
K.K.Ganguly (Expert) 12 November 2013
1. If the Bank has taken physical possession of your mortgaged property then it is within its authority to handover custody of the said property to its hired custodian,

2. Only DRT has jurisdiction to hear any grievances after measures u/s13(4) under SARFAESI Act,2002 have been taken by the Bank,

3. Since no Civil Court has any Jurisdiction in this matter, file SARFAESI Appliaction U/S17 of the Act before the DRT,

4. Custodians are not Tenants. They are the hired agents of the Banks,

5. As per Section 14 of the Act, Security Creditor applies before the DM for taking possession of the mortgaged property from the Borrower/Occupier to handover the same to the Bank,

6. Borrowers can not appeal to DM u/s14 of the Act to take repossession of the taken over property,

7. Only DRT &/or DRAT can pass order directing the Bank to return possession of the property if it is proved that the SARFAESI Proceeding initiated by the Bak was faulty and not as per the Act,

8. Engage a local lawyer having specialisation in attending DRT cases.


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