SARFAESI Act is not applicable on agricultural land, However, if the said Agricultural land is not used for the purpose of agriculture and is used for constructing residential apartments, then the said land is not considered as agricultural land and SARFSESI Act is applicable on such land T Kalaiselvan Advocate, Vellore 77447 Answers
Is sarfsesi Act applicable on agricultural land?
SARFAESI Act is not applicable on agricultural land, 2. However, if the said Agricultural land is not used for the purpose of agriculture and is used for constructing residential apartments, hen the said land is not considered as agricultural land and SARFSESI Act is applicable on such land.
Which property can be subject to SARFAESI Act?
Any immovable property can be a subject matter of equitable mortgage and hence is amenable to SARFAESI Act. SARFAESI is effective only for secured loans where bank can enforce the underlying security eg hypothecation, pledge and mortgages. In such cases, court intervention is not necessary, unless the security is invalid or fraudulent.
Can agricultural land be protected by the Security Interest Act?
This provision, like many others is intended to protect agricultural land held for agricultural purposes by agriculturists from the extraordinary provisions of this Act, which provides for enforcement of security interest without intervention of the Court.
Can bank attach property under SARFAESI under NPA?
Subsequently the loan become NPA. In this circumstance the bank can attach the property under SARFAESI, even though property is classified as agricultural land, there is no cultivation and there is building and factory. If any bank favorable judgement of Madras High Court or Supreme Court, kindly give me.
Which assets are not covered under Sarfaesi Act?
The SARFAESI Act isn’t applicable for:Money or security issued under the Indian Contract Act or the Sale of Goods Act, 1930.Any conditional sale, hire-purchase, lease or any other contract in which no security interest has been created.Any rights of the unpaid seller under Section 47 of the Sale of Goods Act, 1930.More items…
Can agricultural land be auctioned in India?
Agriculture land cannot be proceeded for recovery of loan. In case the agriculture land was mortgaged then only it can be auctioned otherwise the agriculture land cannot be auctioned by the bank.
Can agricultural land be mortgaged in Maharashtra?
For instance, in Maharashtra, transfer (the term includes mortgage) of agricultural land cannot be done other than for speci c purposes which include a transfer for the purposes of agriculture/cultivation and/or educational and charitable purposes only.
What is the limit of sarfaesi act?
The Ministry of Finance, vide its notification dated 24th February 2020, notified that the NBFCs with asset size of Rs. 100 crores or more are eligible NBFCs that are covered under the SARFAESI Act to enforce security interest on debts amounting to at least Rs. 50 lacs.
Can agricultural land be attached?
The Executing Court observed that there is no provision in the CPC, which puts bar against attachment and sale of agriculture land. Special provisions for sale of agriculture produce has been given in Order 21 Rules 74 & 75 CPC.
Can agricultural land be mortgaged in West Bengal?
The mortgage of land for the project had raised eyebrows in banking circles as mortgage of agricultural land for non-agricultural purposes is not permitted in West Bengal.
Can agricultural land be mortgaged to Bank?
1. The Bank can take the agricultural land as mortgaged security while providing loan. 2. However, the said lending Bank can not initiate SARFAESI proceeding to take possession of the said mortgaged property and sell it of to recover the dues of the mortgagor/borrower.
Can agricultural land equitable mortgage?
Agricultural land: Certain states prohibit equitable mortgages on agricultural land. Further, in certain states permission from/notice to the revenue authority may be required before the creation of an equitable mortgage on agricultural land.
Can we take mortgage loan on agricultural land?
A agricultural land is pledged as a collateral. The borrower should have clear titles to the land to be eligible to apply for a Loan Against Agricultural Land. Usually, lenders prefer borrowers to have residence stability of 2 years. Most banks offer loans based on the size of the land pledged.
What is limit of loan under which sarfaesi act not eligible or applicable?
100 crores or more, and the amount of debt less than Rs. 50 lacs: The NBFC is eligible to be considered as a financial institution under SARFAESI Act. However, security interest on the particular debt which amounts to less than Rs. 50 lacs, cannot be enforced.
Is sarfaesi Act applicable to movable property?
Taking symbolic Possession of Movable Secured Assets is not permissible in law. Procedure for taking Possession of Movable Secured Assets is different from the procedure relating to the Immovable Secured Assets.
What is Section 13/4 sarfaesi act?
Under Section 13(4), after the accounts are being declared as NPA and the representation of the borrower/guarantor is rejected, the secured creditor (i.e. bank or FI) can take recourse to any of the measures specified therein to recover its outstanding debt.
What is the Sarfaesi Act?
The Sarfaesi act covers any asset, movable or immovable, given as security whether by way of mortgage, hypothecation or creation of a security interest. There are some exceptions in the act such as personal belongings. However, only that property given as security can be proceeded under the provisions of SARFAESI Act.
Can a property be a security under the Sarfaesi Act?
However, only that property given as security can be proceeded under the provisions of SARFAESI Act. If the property of the borrower is his own mortgaged residential house, it is also NOT exempted from the Sarfaesi act.
Is Sarfaesi Act applicable to agricultural land?
1. SARFAESI Act is not applicable on agricultural land, 2. However, if the said Agricultural land is not used for the purpose of agriculture and is used for constructing residential apartments, hen the said land is not considered as agricultural land and SARFSESI Act is applicable on such land.
What is the question as to whether the land is agricultural?
the question as to whether the land is#N#agricultural has to be determined on the basis of the totality of facts and circumstances#N#including the nature and character of the land, the use to which it was put and the#N#purpose and intent of the parties on the date on which the security interest was created
Can you mortgage land for agriculture?
Normally, no agricultural land can be mortgaged for raising loan for other than agricultural activities. This is of course, state specific and you have to check if in your state this condition is applicable or not.
Can agricultural land be sold under Sarfaesi Act?
Agricultural land cannot be sold under SARFAESI Act as creation of security interest on the same itself is barred u/s. 31 (i) of the act and applying the principle of marshalling under section 56 of TP Act, if recovery of debt is possible by disposing off other properties then the bank cannot sell the agricultural lands. Please refer judgment of Hon’ble Supreme Court in the case of Maharaji Educational Trust vs. Housing and Urban Development Corporation Ltd. reported in 2017 (14) SCC 453.
Can agriculture land be auctioned?
In case the agriculture land was mortgaged then only it can be auctioned otherwise the agriculture land cannot be auctioned by the bank.