Tanveer ul Qamar 02 September 2024

Drt recovery process.

A bought a flat in loan, being unable to repay the loan, account became NPA, therefore Bank filed a case in DRT and later it was disposed ex- parte, where it DRT ordered the borrower to repay the entire amount in 45 days or bank may proceed with the sale of said flat. Now the Flat in question is not in a position to sale due to its structural defect and also some Civil cases between the builder and the landowners. My question is if Bank is unable to sale the said flat, what other options are available to the bank,bfor recovery keeping in mind that borrower don't have the possession of the flat, as the entire building is declared unfit to reside, and borrower don't have any moveable or immovable property in his name.

Please advise

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T. Kalaiselvan, Advocate (Advocate) 02 September 2024

Banks have the authority to reduce the price by a certain percentage (Generally 10 %) and place the property in auction again. This process can be repeated again if there are no bidders in the subsequent auction as well.

under the Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest (SARFAESI) Act, banks have the authority to auction properties to recover their dues without the intervention of the court.

If the bank is unable to sell the property at the auction, it can take possession of the property and sell it through private treaty.

In this case, the bank can sell the property at a price lower than the reserve price set at the auction.