SARFESI ACT

This query is : Resolved

akshay maloo (Querist)
Follow

11 November 2022 In auction, the bidder has paid full amount to the bank, but bank hasn’t issue sale certificate and taking time to issue the same.

What is the limit for bank to issue sale certificate ? Also which section of the act governs the same?

Aashok Kumar Sharma online

Aashok Kumar Sharma

(Expert)
Follow

11 July 2024 In the context of an auction where a bidder has paid the full amount but the bank has not issued the sale certificate, typically, the issuance of sale certificate is governed by the provisions of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest (SARFAESI) Act, 2002 in India. Here are the key points related to the issuance of sale certificate under SARFAESI Act:

1. **Time Limit for Issuance:** According to Section 13(8) of the SARFAESI Act, once the secured asset is sold through public auction, the authorized officer (usually a bank) must issue a certificate of sale within fifteen days from the date of sale. This certificate is issued to the purchaser of the asset.

2. **Purpose of Sale Certificate:** The sale certificate serves as proof of the transfer of ownership of the asset from the borrower to the purchaser (bidder). It also ensures that the purchaser's title to the asset is properly established.

3. **Legal Implications:** Until the sale certificate is issued, the bidder may not have clear legal ownership of the asset. This can affect their ability to take possession, register the asset under their name, or take further legal actions related to the asset.

4. **Remedies:** If the bank delays or fails to issue the sale certificate within the stipulated time, the bidder/purchaser can approach the Debt Recovery Tribunal (DRT) or the relevant appellate authority under the SARFAESI Act to seek a direction for issuance of the sale certificate.

Therefore, in your case, if the bank has received the full payment but is delaying the issuance of the sale certificate, the bidder should first communicate with the bank and request expedited issuance as per the SARFAESI Act's provisions. If the delay persists beyond the statutory period of fifteen days, legal recourse may be necessary to compel the bank to issue the certificate. It's advisable to consult with a legal professional familiar with SARFAESI Act procedures for specific guidance and assistance.

You need to be the querist or approved CAclub expert to take part in this query .
Click here to login now