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Subhojit (Banker)     22 July 2009


Dear Friends, Please let me know whether the secured creditior can move to the CJM court u/s 14 of SARFAESI Act, for physical posseion of the secured property,in a case where he has serviced the notice to the borrower us 13(2) and not servicing 13 (4).


 2 Replies

rajesh (law officer)     23 July 2009

notice under 13(2) is served calling upon the borrower/guarantor to pay the debt failing which action under 13(4) will be taken. Thus 13(2) talks about 60 days notice whereas 13(4) deals with action if amount is not paid within 60 days.  If u read 13(4) it reads that secured creditor may take recourse to one or more of folowing measures to recover his secured debt :-

13(4)(a) take possession of the secured assets of the borrower ....


thus 13(2) providees for giving 60 days notice demanding repayment of debt. (in case any objections are received same are to replied within one week as per section 13(3A).  upon failure to repay within 60 days , the next step is to take action by way of taking possession.


For taking possession, the authorised officer may take possession by affixing possession notice on the property (Rule 8 of SARFAESI Rules) duly notarized and such possession notice is to be published in two newspaper within seven days from date of taking possession. in case any resistance is anticipated , assistance of DM or chief metropolitian magistarate or cjm may be taken under section 14 for taking over the possession. for taking assistance of cjm no prior notice is rtequired however once the possession is taken through cjm possession notice is required to be affixed and published as per rules.

G.H. SUBBU (Advocate)     22 October 2009

Dear Subbojitji,

There is no necessary for the Bankers to issue 13(4) notice for getting orders from CJM under 14. If they anticipates any resistance in taking physical possession, they can directly apply with DM or CJM under sec.14.  Only 13(2) Notice and due ack need for obtaining orders under sec,.14.

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