Answer: The Secured Creditor cannot himself purchase the secured property in the first auction. However, if the first auction has been postponed for want of a bid at reserve price, an officer authorised by the secured creditor may bid for the property on behalf of the secured creditor at any subsequent sale. See Section 13(5A) of Sarfaesi Act, 2002

Answer : If the borrower pays the entire claim of the secured creditor at any time before the date of publication of notice for public auction or inviting quotations or tender from public or private treaty, the secured assets, shall not be transferred by way of lease, assignment or sale by the secured creditor. See Section 13(8) of Sarfaesi Act, 2002

Answer: According to Rule 8(5) of the Security Interest (Enforcement) Rules 2002, before effecting sale of the immovable property referred to in sub-rule (1) of rule 9, the authorised officer shall obtain valuation of the property from an approved valuer and in consultation with the secured creditor, fix the reserve price of the property and may sell the whole or any part of such immovable secured asset by any of the following methods:- by obtaining quotations from the persons dealing with similar secured assets or otherwise interested in buying the such assets; or by inviting tenders from the public; by holding public auction including through e-auction mode; or by private treaty

Answer: According to Rule 8(6) of the Security Interest (Enforcement) Rules 2002, the authorised officer shall serve to the borrower a notice of thirty days for sale of the immovable secured assets, under sub-rule (5). However, the provision to Rule 9(1) of the said Rule provides that if sale of secured immovable property fails and is required to be conducted again, the authorised officer shall serve, affix and publish notice of sale of not less than fifteen days to the borrower, for any subsequent sale.

Case Laws

Answer: According to the provision to Rule 8(6) of the Security Interest (Enforcement) Rules 2002, if the sale of immovable secured assets is being effected by either inviting tenders from the public or by holding public auction, the secured creditor shall cause a public notice (in the Form given in Appendix IV-A to the Security Interest (Enforcement) Rules 2002), be published in two leading newspapers including one in vernacular language having wide circulation in locality.

Answer: According to Rule 8(7) of the Security Interest (Enforcement) Rules 2002, the notice of sale shall be affixed on a conspicuous part of the immovable property.

Answer: According to Rule 9(1) of the Security Interest (Enforcement) Rules 2002, no sale of immovable property shall take place before the expiry of thirty days from the date on which the public notice of sale is published in newspapers. Provided that in the case of subsequent sale, the time gap shall be not less than 15 days.

Answer: According to Rule 9(2) of the Security Interest (Enforcement) Rules 2002, the sale shall be confirmed in favour of the purchaser who has offered the highest sale price in his bid or tender or quotation or offer to the authorised officer and shall be subject to confirmation by the secured creditor. Provided that no sale shall be confirmed, if the amount offered by sale price is less than the reserve price.

Answer: According to Rule 9(3) of the Security Interest (Enforcement) Rules 2002, on every sale of immovable property, the purchaser shall immediately, i.e. on the same day or not later than next working day, as the case may be, pay a deposit of twenty-five per cent of the amount of the sale price, which is inclusive of earnest money deposited, if any, to the authorised officer conducting the sale and in default of such deposit, the property shall be sold again.

Answer: According to Rule 9(4) of the Security Interest (Enforcement) Rules 2002, the balance amount of purchase price (balance 75% ) shall be paid by the purchaser to the authorised officer on or before the fifteenth day of confirmation of sale of the immovable property or such extended period as may be agreed upon in writing between the purchaser and the secured creditor, in any case not exceeding three months.

Answer: According to Rule 9(6) of the Security Interest (Enforcement) Rules 2002, on confirmation of sale by the secured creditor and if the terms of payment have been complied with, the authorised officer exercising the power of sale shall issue a certificate of sale of the immovable property in favour of the purchaser in the form given in Appendix-V to Security Interest (Enforcement) Rules 2002.