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sukhbir singh (Businessman)     24 March 2010

Action under 13(4) of SARFAESAI Act

Bank has filed notice u/s 13(2) of Sarfaesai act.  We gave a represetnation with the request to make part substantial payment and balance to be restructured along with release of some properties.  Bank issued NOC for sale of property and allowed the borrower to make payment.  The Bank accepted the request of the borrower and issued acceptance of proposal within a period of two days.   Can Bank issue now notice u/s 13(4) for recovery of the balance amount. and not restructure the account as requested by the party.  The Bank has not rejected the application of borrower and accepted the payment of dues.


Please advise whether Bank can issue notice u/s 13(4) where the substantial amount has been accepted by the bank on representation of the party as well as accepted its proposal for restructuring of the loan.  The Bank had not rejected the contents of the letter and application of the borrower but accepted it.


 3 Replies

Daksh (Student)     25 March 2010

Mr.Sukhbir Singh,

If the Bank has agreed and acted on your representation by accepting the part consideration in lieu thereof the same is binding upon it.

More so the affairs of the Bank are to be conducted as per its Manual - it is advised that you may get a written confirmation from the bank in this regard.

Best Regards


sukhbir singh (Businessman)     26 March 2010

In my represenation where I have offered part payment and asked for restructuring etc. there were other proposals also, which have not been rejected in writing by the Bank.  The only communication I received from the Bank was its agreement to mode of payment which was by selling one of the assets which was part of the securities.  The Bank also gave NOC for release of title deed of one of the securities againt payment as suggested in my letter.      Your reply in the first two lines is understood.  However, as you suggested that the affairs of the Bank are to be conducted as per its Manual, and i should get a written confirmation from the bank in this not understood.......can a Bank frame rules in its Manual contrary to the Act which clearly says that on representation from the borrower, the Bank is required to reply within a week and in this case Bank accepted the contents of the borrower letter with regard to payment schedule.    In spite of this can they issue notice under section 13(4) after a lapse of 60 days.  Please make it clear and categorical reply.

varmadipak (Retired officer)     19 September 2010

Is publication of possession cum sale notice after taking possession under 13(4) is illegal

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