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manish (propreitor)     12 November 2014

Demand notice under sarfaesi act.

Dear Friends,

I have received a Demand Notice from my bank regarding my loan asking an amount of Rs 600000/- to be paid in sixty days, 

My query is - My over due amount is only 55000/-, If I pay this amount and regularise my account, can the bank withdraw this Sarfaesi Process. 

Kindly help at the earliest.





 7 Replies

V M DAHAKE (PROPRIETOR)     12 November 2014

Dear Manish,

 Notice means what it says. You can always regularize your account. Better, call on the bank, pay them overdue and request them to give you a letter withdrawing the notice. Else you will have to reply the notice and defend banks action for possession u/s 13(4) of SARFAESI.

1 Like


The demand notice has been issued pursuant to the bank's action of classifying your loan account as NPA. Hence approach the bank and try to remit the " critical amount:"and come out of NPA first and seek for restructure / rephasement of future installments if possible.Once this happen the SARFAESI process automatically gets terminated. Feel free to contact the branch officials and try to sort out the issue amicably. If there is inadequate response, then contact the Regional office of the bank. All the best.

P. Thangavel, Advocate & Former Senior Manager of leading  PSB.

1 Like

manish (propreitor)     13 November 2014

Thanks Sir,

I am in a position to repay the overdues and will do as instructed by you....thanks once again..


pervez (adviser)     13 November 2014

if the amount due is less than 20% of the principal and interest thereon, no action will lie under SARFAEASI.. you can regularise the account anytime...

Jitesh (self)     19 November 2014

Mr.Pervez, pls share any judgement on this.

Kartik nanda (Owner)     16 December 2014



i needed advise on a similar case. I have received a notice from the bank under the sarfaesi actfor a recovery against a loan that has become an NPA. They have given us 60 days to repAy the full amount. Due to certain constraints, I am unable to do that at the moment. Is there any way to ask for more time? Also, in the case I am unable to pay, what is the process that the bank will follow? Any help on this will be greatly appreciated.

V M DAHAKE (PROPRIETOR)     17 December 2014

Dear Kartik,

 Reply will be similar. To put it in perspective, banks have power to enforce mortgage without intervention of court. They can do so by first giving notice under 13 (2) of Sarfaesi giving borrower an opportunity to repay or give satisfactory representation / submission. In case of failure of borrower, bank can proceed with taking over possession ( procedure is prescribed).

Borrower needs to approach bank for settlement AND also issue suitable reply to notice. Mere oral assurances of the bank should not be taken at face value. If bank is convinced, it can grant you more time. While reply to notice does not mean bank will accept that, it would help you if you decide to contest bank's action in DRT.

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