The Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002
Administered Ministry: Ministry of Finance / Department of Financial Services
Section
Section 17A Making of application to Court of District Judge in certain cases.
17A. [Making of application to Court of District Judge in certain cases.] Omitted by the Jammu and Kashmir Reorganization (Adaptation of Central Laws) Order, 2020, vide notification No. S.O. 1123(E) dated (18-3-2020) and Vide Union Territory of Ladakh Reorganisation (Adaptation of Central Laws) Order, 2020, notification No. S.O. 3774(E), dated (23-10-2020).
Section 18 Appeal to Appellate Tribunal. 1 docs
(1) Any person aggrieved, by any order made by the Debts Recovery Tribunal 1[under section 17, may prefer an appeal along with such fee, as may be prescribed]to the Appellate Tribunal within thirty days from the date of receipt of the order of Debts Recovery Tribunal.
2[Provided that different fees may be prescribed for filing an appeal by the borrower or by the person other than the borrower:]
3[Provided further that no appeal shall be entertained unless the borrower has deposited with the Appellate Tribunal fifty per cent. of the amount of debt due from him, as claimed by the secured creditors or determined by the Debts Recovery Tribunal, whichever is less:
Provided also that the Appellate Tribunal may, for the reasons to be recorded in writing, reduce the amount to not less than twenty-five per cent. of debt referred to in the second proviso.]
(2) Save as otherwise provided in this Act, the Appellate Tribunal shall, as far as may be, dispose of the appeal in accordance with the provisions of the Recovery of Debts Due to Banks and Financial Institutions Act, 1993 (51 of 1993) and rules made thereunder.
2[Provided that different fees may be prescribed for filing an appeal by the borrower or by the person other than the borrower:]
3[Provided further that no appeal shall be entertained unless the borrower has deposited with the Appellate Tribunal fifty per cent. of the amount of debt due from him, as claimed by the secured creditors or determined by the Debts Recovery Tribunal, whichever is less:
Provided also that the Appellate Tribunal may, for the reasons to be recorded in writing, reduce the amount to not less than twenty-five per cent. of debt referred to in the second proviso.]
(2) Save as otherwise provided in this Act, the Appellate Tribunal shall, as far as may be, dispose of the appeal in accordance with the provisions of the Recovery of Debts Due to Banks and Financial Institutions Act, 1993 (51 of 1993) and rules made thereunder.
1. Subs. by Act 30 of 2004, s. 12, for "under section 17, may prefer an appeal" (w.e.f. 21-6-2002).
2. Ins. by s. 12, ibid. (w.e.f. 21-6-2002).
3. Ins. by s. 12, ibid. (w.e.f. 11-11-2004).
2. Ins. by s. 12, ibid. (w.e.f. 21-6-2002).
3. Ins. by s. 12, ibid. (w.e.f. 11-11-2004).
Section 18A Validation of fees levied.
1[18A. Validation of fees levied.--Any fee levied and collected for preferring, before the commencement of the Enforcement of Security Interest and Recovery of Debts Laws (Amendment) Act, 2004, an appeal to the Debts Recovery Tribunal or the Appellate Tribunal under this Act, shall be deemed always to have been levied and collected in accordance with law as if the amendments made to sections 17 and 18 of this Act by sections 10 and 12 of the said Act were in force at all material times.]
1 . Ins. by s. 13, ibid. (w.e.f. 11-11-2004).
Section 18B Appeal to High Court in certain cases.
18B. [Appeal to High Court in certain cases.] Omitted by the Jammu and Kashmir Reorganization (Adaptation of Central Laws) Order, 2020, vide notification No. S.O. 1123(E) dated (18-3-2020) and Vide Union Territory of Ladakh Reorganisation (Adaptation of Central Laws) Order, 2020, notification No. S.O. 3774(E), dated (23-10-2020).
Section 18C Right to lodge a caveat.
1[18C. Right to lodge a caveat.--(1) Where an application or an appeal is expected to be made or has been made under sub-section (1) of section 17 or section 17A or sub-section (1) of section 18 or section 18B, the secured creditor or any person claiming a right to appear before the Tribunal or the Court of District Judge or the Appellate Tribunal or the High Court, as the case may be, on the hearing of such application or appeal, may lodge a caveat in respect thereof.
(2) Where a caveat has been lodged under sub-section (1),--
(a) the secured creditor by whom the caveat has been lodged (hereafter in this section referred to as the caveator) shall serve notice of the caveat by registered post, acknowledgement due, on the person by whom the application has been or is expected to be made under sub-section (1);
(b) any person by whom the caveat has been lodged (hereafter in this section referred to as the caveator) shall serve notice of the caveat by registered post, acknowledgement due, on the person by whom the application has been or is expected to be made under sub-section (1).
(3) Where after a caveat has been lodged under sub-section (1), any application or appeal is filed before the Tribunal or the court of District Judge or the Appellate Tribunal or the High Court, as the case may be, the Tribunal or the District Judge or the Appellate Tribunal or the High Court, as the case may be, shall serve a notice of application or appeal filed by the applicant or the appellant on the caveator.
(4) Where a notice of any caveat has been served on the applicant or the Appellant, he shall periodically furnish the caveator with a copy of the application or the appeal made by him and also with copies of any paper or document which has been or may be filed by him in support of the application or the appeal.
(5) Where a caveat has been lodged under sub-section (1), such caveat shall not remain in force after the expiry of the period of ninety days from the date on which it was lodged unless the application or appeal referred to in sub-section (1) has been made before the expiry of the said period.]
STATE AMENDMENTS
Jammu and Kashmir (UT).--
Amendment of section 18(C)--(i) in sub-section (1), omit "or section 17A", "or section 18B", "or the court of District Judge" and "or the High Court"; and
(ii) in sub-section (3), omit "or the court of District Judge" and "or the High Court".
[Vide Order No. 3807(E) dated 26th October, 2020, the Union Territory of Jammu and Kashmir Reorganisation (Adaptation of Central Laws) Third Order, 2020 (w.e.f. 26-10-2020).
Ladakh (UT).--
Amendment of section 18(C)--
(a) In sub-section (1), omit,--
(i) "or section 17A" and "or section 18B"; and
(ii) "or the court of District Judge" and "or the High Court" whenever they occur;
(b) in sub-section (3) omit "or the court of District Judge" and "or the High Court".
[Vide Union Territory of Ladakh Reorganisation (Adaptation of Central Laws) Order, 2020, notification No. S.O. 3774(E), dated (23-10-2020).]
(2) Where a caveat has been lodged under sub-section (1),--
(a) the secured creditor by whom the caveat has been lodged (hereafter in this section referred to as the caveator) shall serve notice of the caveat by registered post, acknowledgement due, on the person by whom the application has been or is expected to be made under sub-section (1);
(b) any person by whom the caveat has been lodged (hereafter in this section referred to as the caveator) shall serve notice of the caveat by registered post, acknowledgement due, on the person by whom the application has been or is expected to be made under sub-section (1).
(3) Where after a caveat has been lodged under sub-section (1), any application or appeal is filed before the Tribunal or the court of District Judge or the Appellate Tribunal or the High Court, as the case may be, the Tribunal or the District Judge or the Appellate Tribunal or the High Court, as the case may be, shall serve a notice of application or appeal filed by the applicant or the appellant on the caveator.
(4) Where a notice of any caveat has been served on the applicant or the Appellant, he shall periodically furnish the caveator with a copy of the application or the appeal made by him and also with copies of any paper or document which has been or may be filed by him in support of the application or the appeal.
(5) Where a caveat has been lodged under sub-section (1), such caveat shall not remain in force after the expiry of the period of ninety days from the date on which it was lodged unless the application or appeal referred to in sub-section (1) has been made before the expiry of the said period.]
STATE AMENDMENTS
Jammu and Kashmir (UT).--
Amendment of section 18(C)--(i) in sub-section (1), omit "or section 17A", "or section 18B", "or the court of District Judge" and "or the High Court"; and
(ii) in sub-section (3), omit "or the court of District Judge" and "or the High Court".
[Vide Order No. 3807(E) dated 26th October, 2020, the Union Territory of Jammu and Kashmir Reorganisation (Adaptation of Central Laws) Third Order, 2020 (w.e.f. 26-10-2020).
Ladakh (UT).--
Amendment of section 18(C)--
(a) In sub-section (1), omit,--
(i) "or section 17A" and "or section 18B"; and
(ii) "or the court of District Judge" and "or the High Court" whenever they occur;
(b) in sub-section (3) omit "or the court of District Judge" and "or the High Court".
[Vide Union Territory of Ladakh Reorganisation (Adaptation of Central Laws) Order, 2020, notification No. S.O. 3774(E), dated (23-10-2020).]
1. Ins. by Act 1 of 2013, s. 7 (w.e.f. 15-1-2013).
Section 19 Right of borrower to receive compensation and costs in certain cases.
1[19. Right of borrower to receive compensation and costs in certain cases.-- If the Debts Recovery Tribunal or the Court of District Judge, on an application made under section 17 or section 17A or the Appellate Tribunal or the High Court on an appeal preferred under section 18 or section 18A, holds that the possession of secured assets by the secured creditor is not in accordance with the provisions of this Act and rules made thereunder and directs the secured creditors to return such secured assets to the 2[concerned borrowers or any other aggrieved person, who has filed the application under section 17 or section 17A or appeal under section 18 or section 18A, as the case may be, the borrower or such other person shall be entitled to the payment of such compensation and costs as may be determined by such Tribunal or Court of District Judge or Appellate Tribunal or the High Court referred to in section 18B.]
STATE AMENDMENTS
Union Territory of Jammu and Kashmir.--
Amendment of section 19.--(i) Omit "or the Court of District Judge", occurring at both the places;
(ii) Omit "or section 17A" occurring at both the places;
(iii) Omit "or the High Court;
(iv) Omit "or section 18A" occurring at both the places; and
(v) Omit "or the High Court referred to in section 18B" occurring at the end.
Insertion of new section:--After section 19, insert--
19A. Transfer of Pending Applications.--All the pending applications before the court of District Judge and the High Court under sections 17A and 18B respectively, shall stand transferred to the Tribunal and the Appellate Tribunal, as the case may be.
[Vide Order No. 3807(E) dated 26th October, 2020, the Union Territory of Jammu and Kashmir Reorganisation (Adaptation of Central Laws) Third Order, 2020 (w.e.f. 26-10-2020)].
Union Territory of Ladakh--
Section 19.--In section 19,--
(i) omit "or the court of District Judge", "or the High Court" and "or the High Court referred to in section 18B";
(ii) omit "or section 17A" and "or section 18A".
STATE AMENDMENTS
Union Territory of Jammu and Kashmir.--
Amendment of section 19.--(i) Omit "or the Court of District Judge", occurring at both the places;
(ii) Omit "or section 17A" occurring at both the places;
(iii) Omit "or the High Court;
(iv) Omit "or section 18A" occurring at both the places; and
(v) Omit "or the High Court referred to in section 18B" occurring at the end.
Insertion of new section:--After section 19, insert--
19A. Transfer of Pending Applications.--All the pending applications before the court of District Judge and the High Court under sections 17A and 18B respectively, shall stand transferred to the Tribunal and the Appellate Tribunal, as the case may be.
[Vide Order No. 3807(E) dated 26th October, 2020, the Union Territory of Jammu and Kashmir Reorganisation (Adaptation of Central Laws) Third Order, 2020 (w.e.f. 26-10-2020)].
Union Territory of Ladakh--
Section 19.--In section 19,--
(i) omit "or the court of District Judge", "or the High Court" and "or the High Court referred to in section 18B";
(ii) omit "or section 17A" and "or section 18A".
1. Subs. by Act 30 of 2004, s. 14, for section 19 (w.e.f. 11-11-2004).
2. Subs. by Act 44 of 2016, s. 15, for "concerned borrowers, such borrower" (w.e.f. 1-9-2016).
2. Subs. by Act 44 of 2016, s. 15, for "concerned borrowers, such borrower" (w.e.f. 1-9-2016).
Section 20 Central Registry. 2 docs
(1) The Central Government may, by notification, set up or cause to be set up from such date as it may specify in such notification, a registry to be known as the Central Registry with its own seal for the purposes of registration of transaction of securitisation and reconstruction of financial assets and creation of security interest under this Act.
(2) The head office of the Central Registry shall be at such place as the Central Government may specify and for the purpose of facilitating registration of transactions referred to in sub-section (1), there may be established at such other places as the Central Government may think fit, branch offices of the Central Registry.
(3) The Central Government may, by notification, define the territorial limits within which an office of the Central Registry may exercise its functions.
(4) The provisions of this Act pertaining to the Central Registry shall be in addition to and not in derogation of any of the provisions contained in the Registration Act, 1908 (16 of 1908), the Companies Act, 1956 (1 of 1956), the Merchant Shipping Act, 1958 (44 of 1958), the Patents Act, 1970 (39 of 1970), the Motor Vehicles Act, 1988 (49 of 1988), and the Designs Act, 2000 (16 of 2000) or any other law requiring registration of charges and shall not affect the priority of charges or validity thereof under those Acts or laws.
(2) The head office of the Central Registry shall be at such place as the Central Government may specify and for the purpose of facilitating registration of transactions referred to in sub-section (1), there may be established at such other places as the Central Government may think fit, branch offices of the Central Registry.
(3) The Central Government may, by notification, define the territorial limits within which an office of the Central Registry may exercise its functions.
(4) The provisions of this Act pertaining to the Central Registry shall be in addition to and not in derogation of any of the provisions contained in the Registration Act, 1908 (16 of 1908), the Companies Act, 1956 (1 of 1956), the Merchant Shipping Act, 1958 (44 of 1958), the Patents Act, 1970 (39 of 1970), the Motor Vehicles Act, 1988 (49 of 1988), and the Designs Act, 2000 (16 of 2000) or any other law requiring registration of charges and shall not affect the priority of charges or validity thereof under those Acts or laws.
Section 20A Integration of registration systems with Central Registry.
1[20A.Integration of registration systems with Central Registry.-- (1) The Central Government may, for the purpose of providing a Central database, in consultation with State Governments or other authorities operating registration system for recording rights over any property or creation, modification or satisfaction of any security interest on such property, integrate the registration records of such registration systems with the records of Central Registry established under section 20, in such manner as may be prescribed.
Explanation.--For the purpose of this sub-section, the registration records includes records of registration under the Companies Act, 2013 (18 of 2013), the Registration Act, 1908 (16 of 1908), the Merchant Shipping Act, 1958 (44 of 1958), the Motor Vehicles Act, 1988 (59 of 1988), the Patents Act, 1970 (39 of 1970), the Designs Act, 2000 (16 of 2000) or other such records under any other law for the time being in force.
(2) The Central Government shall after integration of records of various registration systems referred to in sub-section (1) with the Central Registry, by notification, declare the date of integration of registration systems and the date from which such integrated records shall be available; and with effect from such date, security interests over properties which are registered under any registration system referred to in sub-section (1) shall be deemed to be registered with the Central Registry for the purposes of this Act.]
Explanation.--For the purpose of this sub-section, the registration records includes records of registration under the Companies Act, 2013 (18 of 2013), the Registration Act, 1908 (16 of 1908), the Merchant Shipping Act, 1958 (44 of 1958), the Motor Vehicles Act, 1988 (59 of 1988), the Patents Act, 1970 (39 of 1970), the Designs Act, 2000 (16 of 2000) or other such records under any other law for the time being in force.
(2) The Central Government shall after integration of records of various registration systems referred to in sub-section (1) with the Central Registry, by notification, declare the date of integration of registration systems and the date from which such integrated records shall be available; and with effect from such date, security interests over properties which are registered under any registration system referred to in sub-section (1) shall be deemed to be registered with the Central Registry for the purposes of this Act.]
1. Ins. by Act 44 of 2016, s. 16 (w.e.f. 1-9-2016).
Section 20B Delegation of powers.
1[20B. Delegation of powers.--The Central Government may, by notification, delegate its powers and functions under this Chapter, in relation to establishment, operations and regulation of the Central Registry to the Reserve Bank, subject to such terms and conditions as may be prescribed.]
1. Ins. by Act 44 of 2016, s. 16 (w.e.f. 1-9-2016).
Section 21 Central Registrar.
(1) The Central Government may, by notification, appoint a person for the purpose of registration of transactions relating to securitisation, reconstruction of financial assets and security interest created over properties, to be known as the Central Registrar.
(2) The Central Government may appoint such other officers with such designations as it thinks fit for the purpose of discharging, under the superintendence and direction of the Central Registrar, such functions of the Central Registrar under this Act as he may, from time to time, authorise them to discharge.
(2) The Central Government may appoint such other officers with such designations as it thinks fit for the purpose of discharging, under the superintendence and direction of the Central Registrar, such functions of the Central Registrar under this Act as he may, from time to time, authorise them to discharge.
Section 22 Register of securitisation, reconstruction and security interest transactions.
(1) For the purposes of this Act, a record called the Central Register shall be kept at the head office of the Central Registry for entering the particulars of the transactions relating to--
(a) securitisation of financial assets;
(b) reconstruction of financial assets; and
(c) creation of security interest.
(2) Notwithstanding anything contained in sub-section (1), it shall be lawful for the Central Registrar to keep the records wholly or partly in computer, floppies, diskettes or in any other electronic form subject to such safeguards as may be prescribed.
(3) Where such register is maintained wholly or partly in computer, floppies, diskettes or in any other electronic form, under sub-section (2), any reference in this Act to entry in the Central Register shall be construed as a reference to any entry as maintained in computer or in any other electronic form.
(4) The register shall be kept under the control and management of the Central Registrar.
(a) securitisation of financial assets;
(b) reconstruction of financial assets; and
(c) creation of security interest.
(2) Notwithstanding anything contained in sub-section (1), it shall be lawful for the Central Registrar to keep the records wholly or partly in computer, floppies, diskettes or in any other electronic form subject to such safeguards as may be prescribed.
(3) Where such register is maintained wholly or partly in computer, floppies, diskettes or in any other electronic form, under sub-section (2), any reference in this Act to entry in the Central Register shall be construed as a reference to any entry as maintained in computer or in any other electronic form.
(4) The register shall be kept under the control and management of the Central Registrar.
Section 23 Filing of transactions of securitisation, reconstruction and creation of security interest.
1[(1)] The particulars of every transaction of securitisation, asset reconstruction or creation of security interest shall be filed, with the Central Registrar in the manner and on payment of such fee as may be prescribed 2***:
3* * * * *
4[Provided 5*** that the Central Government may, by notification, require registration of all transactions of securitisation, or asset reconstruction or creation of security interest which are subsisting on or before the date of establishment of the Central Registry under sub-section (7) of section 20 within such period and on payment of such fees as may be prescribed.]
6[(2) The Central Government may, by notification, require the registration of transaction relating to different types of security interest created on different kinds of property with the Central Registry.
(3) The Central Government may, by rules, prescribe forms for registration for different types of security interest under this section and fee to be charged for such registration.]
3* * * * *
4[Provided 5*** that the Central Government may, by notification, require registration of all transactions of securitisation, or asset reconstruction or creation of security interest which are subsisting on or before the date of establishment of the Central Registry under sub-section (7) of section 20 within such period and on payment of such fees as may be prescribed.]
6[(2) The Central Government may, by notification, require the registration of transaction relating to different types of security interest created on different kinds of property with the Central Registry.
(3) The Central Government may, by rules, prescribe forms for registration for different types of security interest under this section and fee to be charged for such registration.]
1. Section 23 numbered as sub-section (1) by Act 44 of 2016, s. 17 (w.e.f. 24-1-2020).
2. The certain words omitted by s. 17, ibid. (w.e.f. 24-1-2020).
3. The Proviso omitted by s. 17, ibid. (w.e.f. 24-1-2020).
4. Ins. by Act 1 of 2013, s.8 (w.e.f. 15-5-2013).
5. The word "further" omitted by Act 44 of 2016, s. 17 (w.e.f. 24-1-2020).
6. Ins. by s. 17, ibid. (w.e.f. 24-1-2020).
2. The certain words omitted by s. 17, ibid. (w.e.f. 24-1-2020).
3. The Proviso omitted by s. 17, ibid. (w.e.f. 24-1-2020).
4. Ins. by Act 1 of 2013, s.8 (w.e.f. 15-5-2013).
5. The word "further" omitted by Act 44 of 2016, s. 17 (w.e.f. 24-1-2020).
6. Ins. by s. 17, ibid. (w.e.f. 24-1-2020).
Section 24 Modification of security interest registered under this Act.
Whenever the terms or conditions, or the extent or operation of any security interest registered under this Chapter are or is 1[asset reconstruction company] or the secured creditors, as the case may be, to send to the Central Registrar, the particulars of such modification, and the provisions of this Chapter as to registration of a security interest shall apply to such modification modified, it shall be the duty of the 2[asset reconstruction company] or the of such security interest.
1. Subs. by s. 3, ibid., for "reconstruction company" (w.e.f. 1-9-2016).
2. Subs. by s. 3,ibid., for "securitisation company" (w.e.f. 1-9-2016).
2. Subs. by s. 3,ibid., for "securitisation company" (w.e.f. 1-9-2016).
Section 25 Asset reconstruction companyor secured creditors to report satisfaction of security interest.
25. 1 [Asset reconstruction company] or secured creditors to report satisfaction of security interest.--(1) The 1 [asset reconstruction company] or the secured creditors as the case may be, shall give intimation to the Central Registrar of the payment or satisfaction in full, of any security interest relating to the 2[asset reconstruction company] or the secured creditors and requiring registration under this Chapter, within thirty days from the date of such payment or satisfaction.
3[(1A) On receipt of intimation under sub-section (1), the Central Registrar shall order that a memorandum of satisfaction shall be entered in the Central Register.]
(2) 4[If the concerned borrower gives an intimation to the Central Registrar for not recording the payment or satisfaction referred to in sub-section (1),the Central Registrar shall on receipt of such intimation], cause a notice to be sent to the 5[asset reconstruction company] or the secured creditors calling upon it to show cause within a time not exceeding fourteen days specified in such notice, as to why payment or satisfaction should not be recorded as intimated to the Central Registrar.
(3) If no cause is shown, the Central Registrar shall order that a memorandum of satisfaction shall be entered in the Central Register.
(4) If cause is shown, the Central Registrar shall record a note to that effect in the Central Register, and shall inform the borrower that he has done so.
3[(1A) On receipt of intimation under sub-section (1), the Central Registrar shall order that a memorandum of satisfaction shall be entered in the Central Register.]
(2) 4[If the concerned borrower gives an intimation to the Central Registrar for not recording the payment or satisfaction referred to in sub-section (1),the Central Registrar shall on receipt of such intimation], cause a notice to be sent to the 5[asset reconstruction company] or the secured creditors calling upon it to show cause within a time not exceeding fourteen days specified in such notice, as to why payment or satisfaction should not be recorded as intimated to the Central Registrar.
(3) If no cause is shown, the Central Registrar shall order that a memorandum of satisfaction shall be entered in the Central Register.
(4) If cause is shown, the Central Registrar shall record a note to that effect in the Central Register, and shall inform the borrower that he has done so.
1. Subs. by s. 3, ibid., for "securitisation company or reconstruction company" (w.e.f. 1-9-2016).
2. Subs. by s. 3, ibid., for "securitisation company or the reconstruction company" (w.e.f. 1-9-2016).
3. Ins. by Act 30 of 2004, s. 15 (w.e.f. 11-11-2004)..
4. Subs. by s. 15, ibid., for "The Central Registrar shall, on receipt of such intimation" (w.e.f. 11-11-2004).
5. Subs. by s. 3, ibid., for "securitisation company" (w.e.f. 1-9-2016).
2. Subs. by s. 3, ibid., for "securitisation company or the reconstruction company" (w.e.f. 1-9-2016).
3. Ins. by Act 30 of 2004, s. 15 (w.e.f. 11-11-2004)..
4. Subs. by s. 15, ibid., for "The Central Registrar shall, on receipt of such intimation" (w.e.f. 11-11-2004).
5. Subs. by s. 3, ibid., for "securitisation company" (w.e.f. 1-9-2016).
Section 26 Right to inspect particulars of securitisation, reconstruction and security interest transactions.
(1) The particulars of securitisation or reconstruction or security interest entered in the Central register of such transactions kept under section 22 shall be open during the business hours for inspection by any person on payment of such fees as may be prescribed.
(2) The Central Register referred to in sub-section (1) maintained in electronic form shall also be open during the business hours for the inspection of any person through electronic media on payment of such fees as may be prescribed.
(2) The Central Register referred to in sub-section (1) maintained in electronic form shall also be open during the business hours for the inspection of any person through electronic media on payment of such fees as may be prescribed.
Section 26A Rectification by Central Government in matters of registration, modification and satisfaction, etc.
1[26A.Rectification by Central Government in matters of registration, modification and satisfaction, etc.--(1) The Central Government, on being satisfied--
(a) that the omission to file with the Registrar the particulars of any transaction of securitisation, asset reconstruction or security interest or modification or satisfaction of such transaction or; the omission or mis-statement of any particular with respect to any such transaction or modification or with respect to any satisfaction or other entry made in pursuance of section 23 or section 24 or section 25 of the principal Act was accidental or due to inadvertence or some other sufficient cause or it is not of a nature to prejudice the position of creditors; or
(b) that on other grounds, it is just and equitable to grant relief,
may, on the application of a secured creditor or 2[asset reconstruction company] or any other person interested on such terms and conditions as it may seem to the Central Government just and expedient, direct that the time for filing of the particulars of the transaction for registration or modification or satisfaction shall be extended or, as the case may require, the omission or mis-statement shall be rectified.
(2) Where the Central Government extends the time for the registration of transaction of security interest or securitisation or asset reconstruction or modification or satisfaction thereof, the order shall not prejudice any rights acquired in respect of the property concerned or financial asset before the transaction is actually registered.]
(a) that the omission to file with the Registrar the particulars of any transaction of securitisation, asset reconstruction or security interest or modification or satisfaction of such transaction or; the omission or mis-statement of any particular with respect to any such transaction or modification or with respect to any satisfaction or other entry made in pursuance of section 23 or section 24 or section 25 of the principal Act was accidental or due to inadvertence or some other sufficient cause or it is not of a nature to prejudice the position of creditors; or
(b) that on other grounds, it is just and equitable to grant relief,
may, on the application of a secured creditor or 2[asset reconstruction company] or any other person interested on such terms and conditions as it may seem to the Central Government just and expedient, direct that the time for filing of the particulars of the transaction for registration or modification or satisfaction shall be extended or, as the case may require, the omission or mis-statement shall be rectified.
(2) Where the Central Government extends the time for the registration of transaction of security interest or securitisation or asset reconstruction or modification or satisfaction thereof, the order shall not prejudice any rights acquired in respect of the property concerned or financial asset before the transaction is actually registered.]
1. Ins. by Act 1 of 2013, s. 9 (w.e.f. 15-1-2013).
2. Subs. by Act 44 of 2016, s. 3, for "securitisation company or reconstruction company" (w.e.f. 1-9-2016).
2. Subs. by Act 44 of 2016, s. 3, for "securitisation company or reconstruction company" (w.e.f. 1-9-2016).
Section 26B Registration by secured creditors and other creditors.
126B. Registration by secured creditors and other creditors.-- (1) The Central Government may by notification, extend the provisions of Chapter IV relating to Central Registry to all creditors other than secured creditors as defined in clause (zd) of sub-section (1) of section 2, for creation, modification or satisfaction of any security interest over any property of the borrower for the purpose of securing due repayment of any financial assistance granted by such creditor to the borrower.
(2) From the date of notification under sub-section (1), any creditor including the secured creditor may file particulars of transactions of creation, modification or satisfaction of any security interest with the Central Registry in such form and manner as may be prescribed.
(3) A creditor other than the secured creditor filing particulars of transactions of creation, modification and satisfaction of security interest over properties created in its favour shall not be entitled to exercise any right of enforcement of securities under this Act.
(4) Every authority or officer of the Central Government or any State Government or local authority, entrusted with the function of recovery of tax or other Government dues and for issuing any order for attachment of any property of any person liable to pay the tax or Government dues, shall file with the Central Registry such attachment order with particulars of the assessee and details of tax or other Government dues from such date as may be notified by the Central Government, in such form and manner as may be prescribed.
(5) If any person, having any claim against any borrower, obtains orders for attachment of property from any court or other authority empowered to issue attachment order, such person may file particulars of such attachment orders with Central Registry in such form and manner on payment of such fee as may be prescribed.]
(2) From the date of notification under sub-section (1), any creditor including the secured creditor may file particulars of transactions of creation, modification or satisfaction of any security interest with the Central Registry in such form and manner as may be prescribed.
(3) A creditor other than the secured creditor filing particulars of transactions of creation, modification and satisfaction of security interest over properties created in its favour shall not be entitled to exercise any right of enforcement of securities under this Act.
(4) Every authority or officer of the Central Government or any State Government or local authority, entrusted with the function of recovery of tax or other Government dues and for issuing any order for attachment of any property of any person liable to pay the tax or Government dues, shall file with the Central Registry such attachment order with particulars of the assessee and details of tax or other Government dues from such date as may be notified by the Central Government, in such form and manner as may be prescribed.
(5) If any person, having any claim against any borrower, obtains orders for attachment of property from any court or other authority empowered to issue attachment order, such person may file particulars of such attachment orders with Central Registry in such form and manner on payment of such fee as may be prescribed.]
1. Ins. by s. 18, ibid. (w.e.f. 24-1-2020).
Section 26C Effect of the registration of transactions, etc.
1[26C. Effect of the registration of transactions, etc.--(1) Without prejudice to the provisions contained in any other law, for the time being in force, any registration of transactions of creation, modification or satisfaction of security interest by a secured creditor or other creditor or filing of attachment orders under this Chapter shall be deemed to constitute a public notice from the date and time of filing of particulars of such transaction with the Central Registry for creation, modification or satisfaction of such security interest or attachment order, as the case may be.
(2) Where security interest or attachment order upon any property in favour of the secured creditor or any other creditor are filed for the purpose of registration under the provisions of Chapter IV and this Chapter, the claim of such secured creditor or other creditor holding attachment order shall have priority over any subsequent security interest created upon such property and any transfer by way of sale, lease or assignment or licence of such property or attachment order subsequent to such registration, shall be subject to such claim:
Provided that nothing contained in this sub-section shall apply to transactions carried on by the borrower in the ordinary course of business.]
(2) Where security interest or attachment order upon any property in favour of the secured creditor or any other creditor are filed for the purpose of registration under the provisions of Chapter IV and this Chapter, the claim of such secured creditor or other creditor holding attachment order shall have priority over any subsequent security interest created upon such property and any transfer by way of sale, lease or assignment or licence of such property or attachment order subsequent to such registration, shall be subject to such claim:
Provided that nothing contained in this sub-section shall apply to transactions carried on by the borrower in the ordinary course of business.]
1. Ins. by s. 18, ibid. (w.e.f. 24-1-2020).
Section 26D Right of enforcement of securities.
1[26D. Right of enforcement of securities.--Notwithstanding anything contained in any other law for the time being in force, from the date of commencement of the provisions of this Chapter, no secured creditor shall be entitled to exercise the rights of enforcement of securities under Chapter III unless the security interest created in its favour by the borrower has been registered with the Central Registry.]
1. Ins. by s. 18, ibid. (w.e.f. 24-1-2020).
Section 26E Priority to secured creditors.
1[26E. Priority to secured creditors.--Notwithstanding anything contained in any other law for the time being in force, after the registration of security interest, the debts due to any secured creditor shall be paid in priority over all other debts and all revenues, taxes, cesses and other rates payable to the Central Government or State Government or local authority.
Explanation.--For the purposes of this section, it is hereby clarified that on or after the commencement of the Insolvency and Bankruptcy Code, 2016 (31 of 2016), in cases where insolvency or bankruptcy proceedings are pending in respect of secured assets of the borrower, priority to secured creditors in payment of debt shall be subject to the provisions of that Code.]
Explanation.--For the purposes of this section, it is hereby clarified that on or after the commencement of the Insolvency and Bankruptcy Code, 2016 (31 of 2016), in cases where insolvency or bankruptcy proceedings are pending in respect of secured assets of the borrower, priority to secured creditors in payment of debt shall be subject to the provisions of that Code.]
1. Ins. by s. 18, ibid. (w.e.f. 24-1-2020).