Why bad loans can now be better dealt with

Lok Sabha clears bill to amend Sarfaesi, debt recovery tribunal acts

GN Bureau | August 2, 2016


#Sarfaesi Act   #Lok Sabha   #Bad loans   #debt recovery tribunal Act  


To ensure faster recovery and resolution of bad debts by banks and financial institutions, and easier functioning of asset reconstruction companies (ARCs), the Lok Sabha has passed a bill to amend the existing Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest (Sarfaesi) Act, and the debt recovery tribunal (DRT) Act.

The Enforcement of Security Interest and Recovery of Debts Laws and Miscellaneous Provisions (Amendment) Bill, 2016 was introduced by finance minister Arun Jaitley in Lok Sabha on May 11, 2016.

According to prsindia.org, it sought to amend four laws: (i) Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (SARFAESI), (ii) Recovery of Debts due to Banks and Financial Institutions Act, 1993 (RDDBFI), (iii) Indian Stamp Act, 1899 and (iv) Depositories Act, 1996.

The amendments to the Sarfaesi Act allow secured creditors to take possession over collateral, against which a loan had been provided, upon a default in repayment. This process is undertaken with the assistance of the district magistrate, and does not require the intervention of courts or tribunals. The bill provides that this process will have to be completed within 30 days by the district magistrate.

Besides forming a central registry to maintain records of transactions related to secured assets, the bill creates a central database to integrate records of property registered under various registration systems with this central registry. This includes integration of registrations made under Companies Act, 2013, Registration Act, 1908 and Motor Vehicles Act, 1988.

Read more about The Enforcement of Security Interest and Recovery of Debts Laws and Miscellaneous Provisions (Amendment) Bill, 2016.
 

Comments

 

Other News

India set to enter 5G era

After years of intense preparation, India is about to take the next step in information and communication technology. Prime Minister Narendra Modi will launch 5G services in India on October 1 and also inaugurate the 6th Edition of India Mobile Congress 2022 to be held till October 4, at Pragati Maidan, Ne

Ram Shravan Manan: A musical venture that leads to self-reflection

There is this popular saying that epics are never told, but always retold. Ramayana is one such epic and needs no introduction. Its plot is grounded in sacrifice and the end brings out hope that the good always wins. But how is a centuries-old tale of the prince of Ayodhya still relevant for today’s

Garib Kalyan Ann Yojana extended for three more months

In pursuance of the pro-people announcement made by the prime minister in 2021 and successful implementation of additional food security under PM Garib Kalyan Ann Yojana, the union cabinet has approved its extension for a further period of three months, from October to December 2022. At a ti

A great literary feast (that could’ve been even more sumptuous)

A Case of Indian Marvels: Dazzling Stories from the Country’s Finest Writers Edited by David Davidar Aleph, 390 pages, Rs 999 Change is the only constant, and India has always been doing so. Yet, after independence, if there was a year when the p

Govt e-Marketplace sellers report more business

“My volume of business has increased ever since I registered on GeM (Government e-Marketplace) in 2017. Earlier, I could supply items only in the vicinity of my shop in Fort area and only within Mumbai. Now, I ship my products all over the country! I have tied up with India Post and three private cou

How the Hindi Newspaper Business Changed

The Journey of Hindi Language Journalism in India: From Raj to Swaraj and Beyond By Mrinal Pande Orient BlackSwan, 188 pages, Rs 1,195.00 In India, the English-language media is considered the ‘national media’, while the language press

Visionary Talk: Amitabh Gupta, Pune Police Commissioner with Kailashnath Adhikari, MD, Governance Now


Archives

Current Issue

Opinion

Facebook    Twitter    Google Plus    Linkedin    Subscribe Newsletter

Twitter