SARFAESI & Consumer Protection Act

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This topic contains 1 reply, has 2 voices, and was last updated by Dr. Ashok Dhamija Dr. Ashok Dhamija 1 week, 3 days ago.

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  • #5229

    A bank had provided machinery loan to borrower on terms that quotation shall be confirmed by borrower and once that is done, the financial assistance shall be directly disbursed to account of supplier of machinery. Machinery (for self employment) wasn’t supplied by supplier. Borrower preferred complaint against the supplier in Consumer Commission joining bank as party to it. Pending this, actions under SARFAESI are taken. May I get a legal recourse to come out of this ?

  • #5252

    It appears from your question (though you have not mentioned it clearly) that the bank has made payment for supply of machinery to the supplier (towards loan given to you) while the supplier has not supplied the machine to you.

    I don’t know what were the conditions for disbursal of loan amount to the supplier, i.e., whether the amount was to be disbursed to the supplier after actual delivery of the machine or even without that in advance. If it was to be paid to the supplier only after supply of the machine and if it has been paid to him even before the supply and the machine has also not been supplied, then it may even amount to an offence of cheating, etc.

    In any case, if the machine is yet to be supplied for which the loan was taken and if the bank has already made the payment to the supplier, and in spite of such facts if the bank is taking action against you for non-payment of loan under SARFAESI (Securitisation and Reconstruction of Financial Assets and Enforcement of Securities Interest Act, 2002), then I think it should be possible to obtain stay against the action being taken by the bank. You should try that, if these are the facts, in consultation with your local lawyer.

         


    Dr. Ashok Dhamija is a New Delhi based Supreme Court Advocate and author of law books. Read more about him by clicking here. List of his Forum Replies. List of his other articles. List of his Quora Answers. List of his YouTube Videos.

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