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Notice under Section 13(4) of SARFAESI Act, 2002

Page no : 5

Anjuru Chandra Sekhar (Advocate )     18 September 2011

Dear Amol,

As per Supreme Court judgments cooperative banks come under the purview of SARFAESI Act, hence there is nothing wrong if a cooperative bank issues a notice under said Act.  After the bank takes any action under section 13 (4) you have to move the DRT by filing Securitization Application under Section 17(1) of the Act.  Before that when you receive Demand Notice under Section 13(2) you have the option to make any representation to bank regarding reduction of excess interest charged etc.  In that representation you can demand the bank to supply with necessary documents to enable you to calculate on your own the amount of balance and you arrive at the present outstanding balance using Microsoft Excelsheet it is simple calculation.  If it is floating interest rate you can demand the banker to supply the rates of interests and changes thereon and calculate accordingly.  You can argue in your SA that excess interest has been charged in your account if you find any variation between your own calculation and bank statement.  Or if the bank neglected to supply necessary data, you can complain about it to DRT and seek stay from it till bank supplies the necessary data to you so that you can argue your case properly. 

Thanks and regards,


ajay (SELF)     19 September 2011






Manas (Student)     30 September 2011

Whether a co-operative bank is registered under SARFAESI Act with Reserve Bank of India as a “Securitisation Company” and/or “Securitisation Creditor”? Whether such a bank can automatically become Securitisation Company/Creditor merely on it being registered as a banking company under Banking Regulation Act, 1949 with Reserve Bank of India? Whether such a bank is required to renew its Certificate every year as contemplated under SARFAESI Act? Whether the bank is required to approve a person to be appointed as  “Authorised Officer”? Whether such a person is required to be registered as contemplated under SARFAESI Act?

Co-operative Banks fall within the definition of  “secured creditor” under SARFESI Act by virtue of the definition contained in section 2(1)(c )(v) of the Act in view of  the notification No. S O.105(E) dated 28th January, 2003 of  the Central Government declaring “Co-operative Bank” as defined in  clause (cci) of section 5 of Banking Regulation Act, 1949 to be a bank for the purposes of SARFAESI. Section 13 of SARFAESI Act, 2002, authorizes the secured creditors to enforce any security interest created in favour of it by the borrower without the intervention of the Court or Tribunal in accordance with provisions of the Act.  As a co-operative bank is not a Securitisation Company, the questions regarding renewal of certificate, appointment of “Authorised Officer”, application for registration, etc., would not be relevant.
The query as to whether enforcement of security interest by a secured creditor is required to be registered with “Central Registry” is an issue relating to the interpretation of the provisions of the Act and it is not “information” covered under the Right to Information Act.   Reserve Bank does not hold information regarding the exercise of powers by the said bank under section 13(4) of the Act. A reference is also drawn to Section 20 of the Act. Such Central Registry contemplated under the Act would not be a part of the Reserve Bank. It is also clarified that the Central Government has so far not issued any notification to set-up the Central Registry. 

Praveen Singh (Lawyer)     30 September 2011

The notification No. S O.105(E) dated 28th January, 2003 of  the Central Government declaring “Co-operative Bank” as defined in  clause (cci) of section 5 of Banking Regulation Act, 1949 to be a bank for the purposes of SARFAESI. Section 13 of SARFAESI Act, 2002, can be challenged on the ground that the same is a notification and not a Statute/Act passed by the Legislature, since the same tries to encroach upon legislation by inserting a new entity in the definition of the Bank in Banking Regulation act and that too without any amendment in the parent act. Thus the same is ultra vires

rajendrakumar (A.R.M(LAW))     15 October 2011

Dear sir

Securitisation Application(SA) under section 17 can be filed only when action u/s 13(4) or 14 initated by the bank . otherwsie no cause of action for SA.

rajendrakumar (A.R.M(LAW))     15 October 2011

Bank can issue fresh notice and no bar on second notice u/s 13(2). You can file Securitisation Application u/s 17 of the Act when action  u/s 14 is initiated by Bank sicne it is equallant to section 13(4) of the Act.  

rajendrakumar (A.R.M(LAW))     15 October 2011

Though the permission not obtain from Authority, action under SARFAESI can be initated in this case and you can not take the defence of Agricultural land  and this kind case decided by High ccourt, Madras in favour of Bank. You have no case of defamation .   

DEFENSE ADVOCATE.-firmaction@g (POWER OF DEFENSE IS IMMENSE )     16 October 2011

Keep cool, after reciept of notice from lender raise objection which they have to reply withing seven days. Issue fresh counter objections. Meawhile issue legal notice forwarning any illegal possession except order from competant court.

parshureddy (recruiter)     13 March 2015


Any one help me. i have been issued a notice under Section 13(4) on my fathers property and bank has not got the property document. my father have it. what is the possibility of the bank to auction my fathers property.

A.Radha Sampath (Advocate)     19 March 2015


First of all it cannot be considered as a notice issued by the Bank. With out issuing the notice to the borrower in an appropriate manner and giving him time, the Bank cannot proceed under Securitisation Act. Hence the court cannot take into purview such case. therefore , there never arises the question of appeal as there can be no existing order against the borrower.

Vijyant Nigam (09807349001) (Advocate)     19 March 2015

Ha Ha Ha...

Bank can do whatever they want because the legislature has provided them ample Powers...

If father's property is mortgaged in any manner, irrespective of the fact that you or your father have the property docs, the Bank can Auction the property...

Bank will first issue Demand Notices and and then Possession Notice and then Sale Notice and atthe last the Auction will go on if you sit over your rights... No One can save you...

Take immediate Legal Steps...

Consult a lawyer near you immediately...

SAKHARAM S LANDGE   15 June 2018


Uday (Lawyer)     03 November 2018

Mr.A.K.D.Sayare, my apologies for delay in replying to you. Due to some personal inconvenience I was not active in the forum for more than a year. By the way, after the amendment in the SARFAESI Act, there is a provision made out under section 18(c) for the Secured Creditors to file caveats.

Uday (Lawyer)     03 November 2018

Dear Sakharam,

You cannot claim loan as your right. The question that arises is whether you availed a loan or not? If availed, have you defaulted in your payment? If your answer is affirmative you do not have a case unless there are some procedural lapses while proceeding under the SARFAESI Act. Please don't waste your money anywhere else. Better pay the Financial Institution and reduce your burden

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