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Amit Kumar   30 April 2021

Registry of property purchased via private treaty sarfaesi

A borrower took loan from finance company by mortagaging his property as an equitable mortgage, after which he defaulted and the Finance Company after following the due process under SARFAESI Act including demand notice, possession notice,sale notice, published in 2 newspapers etc. etc. held auction but no one came for bid and sale failed, then a purchaser approached the company after few months and company after again issuing one more sale notice to borrower sold the property to purchaser by private treaty and issued him a Certificate of Sale.

Now according to revenue records borrower is still the owner of that property and not even entry of any loan was entered in revenue records.
But purchaser want to get his name registered in revenue records and mutation of his name.
(otherwise borrower can even sell property to somebody and many other problems)

Now please guide:-
1. Will the Certificate of Sale issued by the company will get registered and on base of that mutation on name of purchaser.

2. Or a new Sale Deed need to be drafted containing details of Property, Sale Certificate and dates and action by Authorized Officer of the Company under SARFAESI Act will be registered.

3. Purchaser with Authorized Officer went to Sub-Registrar/Tehsildar office where Sub-Registrar told that -  "according to our records owner of the property is the borrower, then how can we register a sale deed by Finance Company favouring Purchaser it could have been done only if Company were owner in our records".

Please somebody guide what to do.....Do i need to draft a Sale deed or will the registrar stamp the same Certificate of Sale issued by Company and then mutation on my name.
Property is situated in Haryana.


 13 Replies

Hemant Agarwal ( Mumbai : 9820174108)     30 April 2021

1. Sale Certificate duly issued under provisions of SARFAESI is Final & Irrefutable and all other statutory authorities (including SRO office) is bound by such Sale Certificate, without any exceptions or excuses and Sale Certificate (which is akin to a Sale Deed) is bound to be duly registered without any reference to the original defaulter owner.

Keep Smiling .... Hemant Agarwal 

Trivendra Kumar Sharma (Practicing Lawyer)     30 April 2021

From the facts, it seems that due order of DRT has not been obtained before effecting sale certificate; property sale has remained private transaction between buyer & Finance Company.

SIVARAMAPRASAD KAPPAGANTU (Retired Manager)     01 May 2021

SARFAESI is applicable to Commercial banks and also Cooperative Banks. It is not known whether what you are referring to as a financial institution is a Commercial Bank or Cooperative Bank.


  1. Whether the Defaulter filed a case in DRT questioning the method of sale in DRT? or 
  2. Is there a case already filed by Bank against the defaulter and if so what is its position now? If there was a case against the defaulter in DRT, whether the Bank filed the appropriate petition in DRT informing sale of the mortgaged property and recovered dues fully or partially?
  3. How long back the sale happen and you were issued with the Sale Certificate under SARFAESI by the Bank?  Did you approach the Registrar for registration of the property in your name based on the said certificate? 

Dr J C Vashista (Advocate)     01 May 2021

The sale transaction  through registered sale deed by the Bank/ Financial Institution is perfect, irrevocable and final.  

Pradipta Nath (Advocate)     01 May 2021

Sale certificate under the SARFAESI has a statutory force and therefore certainly is not illegal. Please find out the certified of the order copy form the DRT and then apply for the registration.

Amit Kumar   01 May 2021

Yes its right, No DRT Order was obtained by company before sale......

Now will it not get registered.........?

P. Venu (Advocate)     01 May 2021

What do you mean by "private treaty"? If the due process in terms of the provisions of the SARFAESI Act has been followed, why the private treaty? The facts posted suggest themselves to be disjointed.

Amit Kumar   01 May 2021

Originally posted by : P. Venu
What do you mean by "private treaty"? If the due process in terms of the provisions of the SARFAESI Act has been followed, why the private treaty? The facts posted suggest themselves to be disjointed.

Rule 8(5)(d) of The Security Interest (Enforcement) Rules, 2002 read with Section 13 of SARFAESI Act states 4 methods of seeling secured asset:-

a) by obtaining quotations b) inviting tenders from public  c) holding public auction  d) private treaty




It is a Finance Company incorporated under Companies Act, 1956 and duly registered as Housing Finance Institution under National Housing Bank Act, 1987.

1. Defaulter has not filed any case questioning the method of sale in DRT.

2. No case by Finance Company in DRT, Finance Company even didn't inform about sale to DRT, they said that it is not required. After which i contacted several other Authorized Officers of different companies by finding their contact numbers online and they too replied that there is no such compulsion to inform DRT before any sale.

3. Sale was happen in March 2021 and Certificate of Sale was also issued in March,2021.

I approached the Registrar with Finance Company's Authorized Officer for registration of the property in my name based on the said certificate, but registrar told - "according to our records owner of the property is the borrower, then how can we register a sale deed by Finance Company favouring Purchaser, it could have been done only if Company were owner in our records"

SIVARAMAPRASAD KAPPAGANTU (Retired Manager)     02 May 2021


The borrower, if at all aggrieved by any of the recovery steps including the possession of the property has the right to move DRT in an appeal against the recovery steps of the financial institution. within 45 days. Therefore, the time limit available for the defaulter to approach to negate the action is already over (Sale happened in March 2021 no date is mentioned, hopefully, its before 15th March 2021).  Therefore, there is no problem from that angle.


Now the problem is from the bureaucracy only, who may be feigning to be ignorant of the process of Sale through the SARFAESI Act and the registration based of the Certificate of Sale thereof.  In case they have any doubt they should only insist upon the Authorised Officer of the financial institution to be present at the time of Registration to ensure the authentication of the certificate issued by him. I am of the view that the Official must be acting as if he does not know about registration based on Sale Certificate under SARFAESI Act.


Therefore, escalate the matter beyond the local Registrar to his higher authorities. Better seek an appointment with the higher official and explain the matter to such official seeking his intervention to resolve the issue. Have over your complaint against the Registrar wherein all points are clearly mentioned duly enclosing copies of the relevant documents. Hopefully, this may yield positive results.


If not,  the alternative is to file suit preceded by legal notice, against the Registrar duly making the financial company also a party (so that they shall authenticate the process of SARFAESI Act and the certificate of sale issued by them) to the suit seeking orders from Court instructing the Registrar to Register the Document as per the SARFAESI Act. Unfortunately, going to Court and dealing with the attendant matters is very long winding with results coming after a very long time and this is known to the Bureaucrats and hence they play the record of ignorance thereby exploiting the situation for their own gain. 

P. Venu (Advocate)     02 May 2021

Yes, the solution is in further escalating the issue by taking up with higher officers. If not successful quick remedy is in approaching the High Court through WP. Having taken up the issue with the higher officers, a further legal notice would not serve much of a purpose. 

As there are undisputed facts, filing a suit is unnecessary.

T. Kalaiselvan, Advocate (Advocate)     02 May 2021

The Certificate of Sale does not require registration.

But, if it is presented for registration, it has to be duly stamped under Article 23 of the Indian Stamp Act, 1899.

The sale is not complete without registration of sale certificate is not sustainable in law. 

If the argument of the borrowers that even after the issuance of the sale certificate, prior to registration, they are entitled to redeem the property is accepted, it would make the provisions of the SARFAESI Act redundant and the very object of the SARFAESI Act enabling the Banks and financial Institutions to realize long term assets, manage problems of liquidity, asset liability mismatch and to improve recovery of debts by exercising powers to take possession of securities, sell them and thereby reduce non performing assets by adopting measures for recovery and reconstruction would fail and would open a pandora’s box for the litigations upsetting the sale confirmed in favour of the bonafide auction purchasers, who invested huge money.

the registration of sale certificate as per section 17(2)(xii) of the Registration Act is not mandatory for the completion of the sale pursuant to the public auction and issuance of the sale certificate under the scheme of the SARFAESI Act. Assuming, the right of redemption conferred under the Transfer of Property act is protected under Section 37 of the SARFAESI Act, and independently available without reference to the registration of the sale certificate under Section 17(2)

Thus based on the sale certificate you may submit an application to the revenue department for mutating the property to your name,.

If the Tehsildar do not entertain your application for mutation you may approach the district collector with an appeal against this decision before approaching court of law for remedy.

For reference : Supreme court citation : Shakeena . vs Bank Of India And Ors. on 20 August, 2019

Amit Kumar   05 May 2021

Please guide if somebody knows :-

1. Will the Certificate of Sale issued by the company will get registered (I mean stamp of Sub-registrar on Certificate of Sale issued by company attached with stamp paper, nothing new to be drafted)

2. Or a new Sale Deed need to be drafted containing Parties and Property details and other details like dates and action by Authorized Officer of the Company under SARFAESI Act, will be registered.

I haven't seen any registry of Sale under Sarfaesi Act.

adv baby kuruvanthanam (advocate)     01 February 2023

Sale conducted under SARFAESI Act is complete in all respects.Sale certificate is not a compulsorily registerable document as per the latest Judgement of Hon'ble apex court.It is optional.However it has to be entered in book No-1.if requested for by the auction purchser without charging stamp duty.Rgarding mutation of property revenue authorities are bound to do it and the property can be tranferred in the name of auction purchaser.


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