Bank Issued a SARFAESI Notice? Know Your Rights Before It Is Too Late

Many borrowers panic upon receiving a notice under the SARFAESI Act, 2002 — not realising they have concrete legal remedies available. This article explains the 60-day objection window, your right to approach the Debt Recovery Tribunal, and the procedural safeguards that protect borrowers from arbitrary bank action. Timely knowledge can save your property.

What Is the SARFAESI Act?

The Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 allows banks and financial institutions to enforce their security interest without court intervention when a loan becomes a Non-Performing Asset (NPA).

The 60-Day Notice Under Section 13(2)

When a bank issues a notice under Section 13(2) of the SARFAESI Act, you have 60 days to repay the outstanding dues. This is your most important window — do not let it pass without taking action.

Your Right to Object — Section 13(3A)

Within the 60-day period, you can file a representation or objection to the bank under Section 13(3A). The bank must consider your objection and communicate its decision in writing within 15 days.

Approaching the Debt Recovery Tribunal

If the bank proceeds despite your objection, you can challenge the action before the Debt Recovery Tribunal (DRT) under Section 17 of the Act. The DRT has powers to stay the bank’s action pending hearing.