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Pandurang ganpat rao chaugule v/s viswasrao patil murugud sahkari bank ltd
Issue :-
whether the definition of 'banking company' contain in section 5(c) of Banking and regulation act 1949 covers cooperative banks registered under state law and also multistate cooperative societies under multi state cooperative societies act 2002 .
1) Whether cooperative bank at state and multistate level are cooperative banks within the purview of SARFAESI Act?
2) Whether provision of SARFAESI act apply to cooperative banks registered under MSCS Act?
Facts:- on 13/03/2018, pandurang ganpati chaugule (appellant),question the action of viswasrao patil murugud sahkari bank limited under SARFAESI Act before the civil judge in spl suit no. 226 of 2007. Deciding the preliminary issue the trial court held that it did not have the jurisdiction to decide the suit. the first appeal preferred was dismissed against that, the appeal has been preferred before this court a separate petition under section 13 by cooperative banks during the pendency of matter, the central government brought into force the enforcement of security deposits and debts law (amendment) act 2012 (act of 2013), amending the definition of section2 (1) (c) of the SARFAESI act, the amendment has also been questioned in the writ petition filed in the court. Here, comes into picture the SARFAESI act and firstly we have to understand it in detail and what are its uses.
SARFAESI ACT:-
securitization and reconstruction of financial assets and enforcements of security interest act 2002(SARFAESI) was enacted to regulate securitization and reconstruction of financial assets and enforcement of security interest created in respect of financial assets to enable realization of such assets. It is a blueprint or the roadmap for the enforcement of interested security by a secured creditor without the intervention of any court or tribunal. it tells that if any borrower fails to discharge the liability in repayment of any secured debt within 60 days of notice by secured creditor ,the secured creditor is conferred with the power under SARFAESI act to-
1) Take possession of secured asset of the borrower including transfer by way of lease, assignment for scale for realizing secured assets.
2) Takeover of the management of the business of the borrower including the right to transfer by way of lease, assignment for sale for realizing the secured asset.
3) Appoint any person to manage the secured assets possession of which is taken by the secured creditor.
4) Require any person who has acquired any of secured assets from the borrower and from whom money is due to pay secured creditor so much of money as if sufficient to pay secured debt.
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