The Supreme Court of India recently clarified the scope of a borrower's right to redemption under the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest (SARFAESI) Act, 2002. The Court ruled that if an auction purchaser fails to deposit the balance sale consideration within the legally prescribed timeframe, the sale process remains incomplete and lacks finality. Crucially, even the issuance of a sale certificate does not extinguish the borrower's right of redemption if the auction purchaser's payment was belated. Consequently, the borrower cannot be divested of their property ownership if they choose to repay the outstanding dues during this period of procedural incompleteness. This judgment emphasizes that strict compliance with statutory timelines is mandatory to terminate a borrower's interest in the secured asset.
Loading page, please wait…