YES. Despite receiving the notice from the bank for auction of your property, you can still prevent auction of your property. Issue of notice does not automatically permit banks to auction your property. You can file an application before the Debt Recovery Tribunal under Section 17 of SARFAESI Act against bank taking possession and stopping auction sale.

However, before you take any legal action, understand the stage till where bank has completed proceedings. Simply filing an application that you do not want your property to be auctioned will not lead the court/tribunal stopping auction. It must be accompanied with valid legal points like service of Section 13(2)/13(4) notice not being done properly, loan not being classified as NPA properly, statutory timelines not being followed by bank etc.

Our lawyers Advocate BK Singh & Advocate Sadhna Singh handle urgent matters like these where we file application for immediate stay before Debt Recovery Tribunal. In most cases we have successfully obtained stay of auction if applications are filed at the right time and at right stage.

Even though you received notice from bank, do not delay. Once auction is published it will be extremely difficult for you to stop auction.

The debt recovery tribunal (DRT) deals with such matters. Borrower, guarantor or owner can approach Tribunal under Section 17 of SARFAESI Act to oppose auction sale conducted by banks / financial institutions. Tribunal then examines if bank has taken due care before resorted to possession & auctioning property. If any defect is pointed out by borrower opposing such action, tribunal can stop auction by banks.

Order passed by Tribunal can be appealed before Debt Recovery Appellate Tribunal (DRAT). In rare cases, constitutional remedies are also filed before High Court under Article 226/227 of Constitution of India but only when extraordinary situations are met.

Advocate BK Singh & Advocate Sadhna Singh mostly deal with cases before Tribunal where we seek urgent stay of auction proceedings being taken by banks / financial institutions. We have seen most of these matters are decided at Tribunal level itself when valid grounds are pointed out.

Notice under Section 13(4) of SARFAESI Act can definitely be challenged before Debt Recovery Tribunal under Section 17 of SARFAESI Act, 2002. Section 13(4) Notice is served by bank / financial institution on borrowers intimating that it has taken possession of the secured assets.

Challenge can be made on various grounds including illegal possession, non-compliance of previous notice served under section 13(2), non-valuation or incorrect valuation, bank not complying with mandatory provisions under SARFAESI Rules etc.

Please note that you need to act quickly against section 13(4) notice as bank will most likely go ahead with auction / sale of property.

It will be upon the borrowers to convince the court that possession was taken illegally and without giving borrower a fair opportunity. Borrowers must remember that delay can affect your rights after bank issues section 13(4) notice.

We have successfully filed applications for urgent stay against such notices where we prove bank has taken illegal possession of borrower’s property. Court may stay such recovery process till final disposal of the application.

NO. Even after you default on loan EMIs and bank account gets classified as NPA, bank cannot directly start auction proceedings. Section 13(4A) provides for issuance of demand notice under Section 13(2) and gives defaulting borrower 60 days to repay the loan. Only when borrower does not respond within 60 days, bank can move forward with recovery action under SARFAESI.

All these steps are mentioned in SARFAESI Act and banks have to mandatorily follow the process one by one in order to take possession & sell property. Even after completing above said steps, if bank does not comply with even one of the requirement, auction can be stopped by borrowers.

Advocate BK Singh & Advocate Sadhna Singh explain this to our clients all the time. Just because you have defaulted against your loan does not mean banks can immediately auction your property. There are several steps bank has to follow.

Therefore, the entire process is not automatic and banks need to mandatorily follow each & every step in order to auction the secured assets.

Yes. Valuation reports can also be challenged before Tribunal. Every bank is required to get property valued by a professional valuer before going for auction.

If you find valuation too low and not in accordance with current market trends, you can oppose such auction before Tribunal. Courts usually examine if valuation was fair and in accordance with dominant market trends.

Our lawyers Advocate BK Singh & Advocate Sadhna Singh have often successfully challenged undervaluation of properties by banks where bank intended to sell their properties at ridiculously low prices.

The moment you receive any notice under SARFAESI Act you should immediately hire a lawyer. You should not wait for bank to take possession of your property or till auction is completed. Speed is very essential in such matters.

Loan recovery laws in India are drafted in such a way that banks can recover their dues as soon as possible, if no legal action is taken by borrower. Wait until auction gets over and property is sold out to third party and then you will find it very difficult to stop auction sale.

Our lawyers Advocate BK Singh & Advocate Sadhna Singh always advice our clients to take immediate action. We file application for stay before Tribunal at earliest possible time. Remember, courts are more lenient towards applications at initial stage rather than auction getting over.

Yes, Debt Recovery Tribunal can stop auction sale of your property. However, like mentioned above you need valid legal points to convince Tribunal to stop auction proceedings initiated by bank.

In majority of cases we have helped our clients stop auction if case is filed at right time. Remember for every legal remedy there is a time limit. Delaying would only decrease your chances of stopping auction.

For eg. Even though Tribunal has powers to stop auction, it would be an extremely difficult task for you to stop auction once the auction date is published. Act fast to stop auction sale of your property.

Advocate BK Singh & Advocate Sadhna Singh specialises in providing immediate relief to our clients. We have filed application for immediate stay where auctions were supposed to be held within next couple of days.

Tribunal tries to balance the rights of borrower as well as bank. Therefore you stand a good chance of stopping auction if you hire the right lawyer.

Yes, bank can auction property that has been mortgaged by guarantor as well. Guarantor becomes jointly liable for repayment of loan once guarantee becomes operative.

If you are guarantor for your friend or family member, chances are that bank can come after your property to recover their dues, provided your property was also pledged as security against loan.

However, if any technicalities are found during recovery proceedings initiated by bank against guarantor property, you can also protect your rights by opposing such recovery actions before Tribunal.

Lawyers Advocate BK Singh & Advocate Sadhna Singh have successfully defended guarantors where bank failed to produce necessary documents against properties that had been mortgaged by guarantors.

Bank is not obligated to give hearing before auctioning your property. Bank is only required to follow statutory notice requirements as mentioned under SARFAESI Act. Once bank gives borrower a notice under Section 13(2) of SARFAESI act, it should wait for 60 days to hear back from borrower.

Borrower has the right to object the same within 60 days on any ground and bank has to reply back in writing within 15 days of receiving such objection. But bank is not required to give hearing before auction even after taking possession under section 13(4).

Advocate BK Singh & Advocate Sadhna Singh have won numerous cases for our clients where bank had failed to respond to borrowers objections or continue with auction sale despite objections being made.

OTS can stop bank auction proceedings. One Time Settlement is an agreement between borrower & bank where borrower agrees to pay certain amount (less than what is due) to settle his account.

If bank agrees to one time settlement proposal made by you, bank will automatically stop auction proceedings. But make sure you get acceptance in writing from bank rather than just trying to convince them by paying some money.

OTS proposals cannot be accepted by bank verbally and until bank gives acceptance in writing your property will still be at risk of being auctioned.

Lawyers Advocate BK Singh & Advocate Sadhna Singh always advice our clients to get every communication in writing from banks. We have seen clients approach us after they have already made part payments or have given certain collateral to bank in false promises of OTS.

Once property is auctioned and sale is confirmed, bank sells the property to auction purchaser and removes all your rights over the property. All legal formalities will be made in the name of the person who has purchased the property from auction.

It would be very difficult for you to file a case after bank has already sold the property to third party purchaser. You can definitely oppose such sale but chances of success are very bleak.

Advocate BK Singh & Advocate Sadhna Singh always advice our clients against delaying matters. Post auction chances of winning are very minimal when compared to stopping auction before it actually gets over.

High Court can stop auction proceedings in rare cases only. Unlike District Court or Tribunal, High Court cannot be approached directly with your matter. You need to follow jurisdiction requirements and approach Tribunal first.

High Court can only be approached where your fundamental rights have been violated or bank has acted without jurisdiction. Filing a case in High Court is always considered as your last resort. Prefer Tribunal over High Courts.

Advocate BK Singh & Advocate Sadhna Singh have rarely approached High Courts for any such matters. We believe in Tribunal and always get our clients the justice they deserve.

Symbolic possession implies that bank has taken possession of the property in eyes of law but has not physically taken possession of the same. Bank indicates such intensions by serving possession notice to borrower and sending notice in newspapers.

You still have physical possession over the property but bank will have all the rights over the property. Symbolic possession is done prior to actual possession by banks.

Advocate BK Singh & Advocate Sadhna Singh view this stage very seriously. Once bank takes symbolic possession, it is clear cut that bank will go for auction of the property very soon.

Reversal of auction sale can only be done on very rare grounds. Once sale is over and rights are passed on to third party purchaser, courts are very less likely to entertain such petitions.

Only if there is evidence of fraud, violation of mandatory provisions or bank acting outside its jurisdiction, can you think of getting auction reversed. This process is lengthy and you would need incur more losses by paying court fees etc.

Advocate BK Singh & Advocate Sadhna Singh always advice our clients to take action before auction is over. Litigating after auction is sold is highly risky and you may end up losing more.

YES. You definitely need a lawyer who specializes in Debt Recovery Tribunal matters. DRT matters are very time sensitive and you cannot afford to lose time explaining your matter to lawyer.

A good lawyer will help you identify the defects in notices sent by bank and will take further necessary legal action. Remember, each objection should be mentioned in detail in order to get relief from Tribunal. If you do not engage a lawyer, chances are you will overlook something very crucial.

Advocate BK Singh & Advocate Sadhna Singh help people just like you. We have helped many clients get stays on auctions just because we had previously found some technical defect with notices.