SARFAESI Act – Important Aspects :

1. This Act is popularly called as Securitization Act

2. This Act empowers the banks and financial institutions to recover their dues in Non- Performing Asset (NPA) accounts, without the intervention of a court

3. This Act also empowers the banks and financial institutions to issue notice for recovery from the defaulting borrowers and guarantors, calling upon them to discharge the dues in full within 60 days

4. In case the borrower and/or guarantor fails to comply with the 60 days’ notice issued by the bank or financial institution in repayment of full dues, then the bank and/or financial institution can:

(a) Take the possession or the management of secured assets of the borrower, and also can transfer the same by way of lease, assignment or sale for realizing the secured assets without the intervention of a court/DRT

(b) Appoint any person to manage the secured assets which have been taken over by the secured creditor (bank)

(c) Also instruct at any time by a notice in writing to a person (i) who holds secured assets of the borrower (ii) from whom any money due or becoming due to the borrower (iii) to pay such money to the secured creditor (bank)