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MANOJ HARIT (LAWYER)     16 January 2013

Sec 13(4) sarfaesi act

Respected Experts,

Is Possession Notice u/s 13(4) & Rule 8 mandatory before moving u/s 14(1) ? Plz provide Citation. 




 6 Replies

c.p.s. ramachary (1500)     20 January 2013

Supreme court in United Bank of India Vs. Satyavati Tondon & Ors.: III (2010) Banking Cases 495(SC) held that, taking symbolic possession u/s 13(4) of the SARFAESI  Act read with Rule8(1) of the S.I.(E) Rules  2002 is not a condition precedent to invoke Sec.14 of the Act. 

MANOJ HARIT (LAWYER)     21 January 2013


Many thanks for the reply. But is the Notice u/s 13(4) read with rule 8(1), not mandatory prior to taking possession after getting the DM's order u/s 14(1)?



c.p.s. ramachary (1500)     21 January 2013

Mr. Manoj,

My reply is very clear. Not a condition precedent means not mandatory. But this 13(4) notice is mandatory after taking physical possession.

Satish (Director)     06 November 2013

Dear Sir, 

Our Company had availed  CC limits from a Private Bank (1st Charge) and Factoring limits from another factoring company ( 2nd Charge on Receivables), The Bank had issued 13(4) Notice where a Reference is pending before BIFR. We have approached DRT and DRT ordered to deposit about 30% and stayed for compliance and if not complied than allowed the Bank to proceed further as per the law.  

We failed to comply  the DRT Order and now can we approach HC for a stay on the Bank to not initiate any action since the Reference is pending with BIFR ,? 


Kindly suggest

c.p.s. ramachary (1500)     28 December 2013

If you have failed to honor the Tribunal's order, you cannot approach High Court since Supreme Court in Prestige Lights Vs. State Bank of India held that a party who has not honored order of a Court / Tribunal need not be heard on merits. It is high hill task to get stay order from H/C under these circumstances

SKapoor_Lawkonect (Lawyer)     06 January 2014

Hi Manoj, the answer to your question is that a possession notice u/s 13 (4) and Rule 8 is mandatory before moving under Section 14(1) is no, a possession notice is not a prerequisite before moving under Section 14 (1) of the SARFAESI Act. The apex court in the case of Union bank of India v Stayawati Tandon has very clearly laid down that a symbolic possession being taken is not the condition precedent for Section 14 of the Act to be enforced. Since you have not clearly mentioned the circumstances of your case it shall be said herein that the Courts decide the cases under SARFAESI Act in consonance with the Rent Eviction Acts and other such state laws. So, you shall take a note that if you are going for eviction proceeding of a rented property which is governed by Rent Control Act you shall try to comply with the requirements of the said law and prove your case beyond doubt to the Court.






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