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Rajashekar (NA)     16 September 2013

Sarfaesi - bank auction property


I have participated in Bank e-Auction property that was conducted by SBI. I am successful bidder and payed 25% of the bid amount on the same day.

1)      From bank authorized officer came to know that borrower gone to court assuming DRT and Bank officer asking me to pay rest of 75% amount by agreed date other wise 25% which have paid will be forfeited. Bank officer saying you can pay full amount and bank will take care of rest of things i.e. Registration on my name etc. What should I do now? Can I go and pay full amount?

Please suggest how to proceed further.








 22 Replies

Advocate Rohit (Advocate)     16 September 2013

if bank has taken the possession of the property through court order, then you need not worry. you may ask the bank to give you an indemnity bond for your safe guard. Also, if the transaction is closed and you take the actual possession of the property, then there is little the court will do.

Further till date no court/DRT has put any stay on the auction. so there is no wrong in the transaction done with the bank.



Advocate Rohit Dalmia



1 Like

NRI Legal Consulting (Consultant)     16 September 2013

Dear Rajashekar,

  I am agree with Advocate Rohit, you need not bother if bank has taken the possession of the property through court order.

for more query contact us query@nrilegalconsulting.com

Rajashekar (NA)     16 September 2013

Hi Rohit and NRI Legal Consulting,

Thanks for your quick reply.

My concern here is as Borrower went to DRT and still Bank can register the property on my name?

Bank already took physical possession of the property.



VIRAJ KADAM (Advocate Supreme Court of India)     18 September 2013

Dear Friend

You need to know if the original owner/borrower has challenged the auction. Secondly, you need to know if the Court has granted any stay in his favour. If there is no stay of the auction then you can pay the balance amount to the bank. If there is stay then join yourself as the party to the pending proceedings and get the order from the Court.




1 Like

Rajashekar (NA)     20 September 2013

Hi Viraj,

Thanks for information. Original owner/borrower has challenged the auction in court.

I will check if the Court has granted any stay in his favour.

Thanks for your valuable time.




khalid masood (partner.)     24 September 2013

Mr.Sekar as far as the bank auction properties are concerned the judgement debtors usually start litigation to prevent the auction purchaser from buying the their property at cheap  price. Because it is always the practice of the banks to sell the JD's property at a low price . We cant find fault with the approach of the bank as borrower does not co operate with the bank when it comes to repayment of loan.  Even one of my friends had to face this problem when he bought the property in auction. He had to pay 2 lakhs to Judgement debtor to withdraw the plaint which ensured the purchaser to purchase the property without any hassles. There  the vale of the the property was 17 lakhs. I would suggest you to calculate accordingly  and settle with the judgement debtor to complete the transaction smoothly without any trouble. Or otherwise he would rake up some issue or other to drag the proceedings and make your life difficult.

Ekta   05 October 2016

Hello, I am facing similer issue, I paid full payment as the authorities said that the dastavej can be processed then, and after paying full the next day SBI authorities said there is a stay on property.

Now they are just delaying it. I just want to know the way out

Thanks in anticipation

LAXMINARAYAN - Sr Advocate. ( solve problems in criminal cases. lawproblems@gmail.com)     16 October 2016

Yes the SARFAESI procedure is comlicated, claim refdund and damages from bank.

Ekta   17 October 2016

Hello Laxminarayan Ji,

The bank authorities are straight away saying not to refund money. It is one month of full payment, They are not saying what is the status of property, is the title clear or not. I know that it is sold under as where is what is terms, but before taking it we should atleast know the clear picture of the property. The bank is not showing that. SBI authority is telling us to talk to Law officer of bank. He says leave everything on us, aap ka ho jayega kaam. The case is in Patna High Court, We dont know when it will be solved or what will happen. 

I just want refund now, and want to get out of this complicated matter. Can you please suggest me what should i do?

LAXMINARAYAN - Sr Advocate. ( solve problems in criminal cases. lawproblems@gmail.com)     17 October 2016

File a case in consumer court for refund and damages.

Law Aspire (Legal)     23 December 2016

If repayment of full due amount is done by Borrower before the execution of sale documents between Bank and the successful bidder . What will be the consequences 

shastibrata (technical head)     16 March 2017

If the borrower pays up the dues, then the auction sale stands cancelled.  The right to property is absolute in favor of borrower until such time the title deed passes on in the name of the Succeesful Bidder.  The right to redemption is in squarely in favor of the borrower until such time. 

1 Like

Uday (Lawyer)     30 August 2017

Some of our friends have suggested that if the bank has obtained an order from the court then we don't have a problem. I would like to give a clarification to this aspect. The ultimate intention of the SARFAESI Act is to enforce the security without the intervention of the court. So, getting an order from the court or not is immaterial. If there is any violation in the process the sale can be set aside. Moreover, we are not sure as to when the stay was granted, i.e., before the auction or after the auction. If these things are clarified, we will be in a better position to guide you on the remedies.

LAXMINARAYAN - Sr Advocate. ( solve problems in criminal cases. lawproblems@gmail.com)     30 August 2017

Mr Udy it seems you have not read the SARFAESI ACT with all the amendments hence your various comments on SARFESI ACT  matters.

1) With amendments in section 14 now no lender can take direct possession . They have to take order from DM and in matripolitan cities by Matropolitan magistrate.


2) This is only for possession thereafter the property holder can raise host of objections.

name;y the authorities did no apply its mind properly for attachment order.

attachment was no legal and so on.

3) We are contesting a case where the DM did not do the panchnama and did not make a seizure list which is specifically detailed in SARFESI ACT rules and hence there is prolongled litigation delaying possession by any body.


4) In host of other cases we have challanged the basic mortage deed and hence thea  SARFESI ACT is not applicable.Now it will be DRT, DART , HIGH COURT THAN EVEN SUPREME COURT. Till that time no body will get possession.

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