As the banking industry has started to face the crises of NPA accounts, which has duly fractured the financial system to maximum limit. Due diligence has become important aspect for the bankers. Therefore, there are some judgements by the hon’ble courts which bankers has to abide expeditiously. Stay will automatically lapse after 6 months in pending trial
The hon’ble supreme court in the matter of Asian resurfacing of road agency Pvt. Ltd. V. Central bureau of investigation, vide it’s judgement dated 28th march, 2018, has held that in all pending matters before the high courts or other courts relating to civil or criminal cases, where stay of proceedings in a pending trail is operating, stay will automatically lapse after 6 months from the date of this judgement unless extended by speaking order.
The court further held that for future proceedings where a stay is granted, unless an extension is granted by way of a speaking order, the stay will end on the expiry of six months from the date of the order. The speaking order, extending the stay must show that the case was of exceptional nature that continuing the stay was more important than having the trial finalized.
Para 35 of the judgement states that:
“we consider it appropriate to direct that in all pending cases where stay against proceedings of a civil or criminal trial is operating , the same will come to an end on expiry of six months from today” unless in an exceptional cases by a speaking order such stay is extended. In cases where stay is granted in future, the same will end on expiry of 6 months from the date of such order unless similar extension is granted by a speaking order. The speaking order must show that case was of exceptional nature that continuing the stay was more important than having the trial finalized. The trial court where order of stay of civil or criminal proceedings is produced, may fix a date not beyond 6 months of the order of stay so that on expiry of period of stay, proceedings can commence unless order of extension of stay is produce. Secured creditors right under section 14 of SARFAESI act subsequently to the sale of immovable property on the basis of symbolic possession:-
Union bank of India and Anr. V. State of West Bengal and others, 2017- The issue raised before the Calcutta High court was whether a secured creditor is entitled to invoke the provisions of section 14 of the SARFAESI subsequently to the sale of an immovable property under SARFAESI Act, 2002, on the basis of symbolic possession? The court, while answering the issue, held that the bank as a secured creditor cannot maintain an application under section 14 of the securitization and Reconstruction of Financial Assets and Enforcement of Security interest Act, 2002 in order to obtain actual physical possession of the property after issuance of a sale certificate.
Selling Tribal land to non-Tribals:-
In UCO Bank vs. Dipak Debbarma, AIR 2016, the respondents, who were members of scheduled tribes of the state, contended that the sale notification issued by the bank under SARFAESI Act, 2002 was in violation of section 187 of the Tripura plans revenue and land reforms act, 1960, as under the act, 1960 there is a legislative embargo on the sale of mortgaged properties by the bank to any person who is not a member of a scheduled tribes. The hon’ble Supreme court has ruled that banks can sell tribal land to non-Tribals, even if prohibited by state law. The provisions of SARFAESI Act 2002, which do not contain any embargo on the category of persons to whom mortgaged property can be sold by the bank for realization of it’s dues, will prevail over the provisions contained in state law. The Apex court further observed that the provisions of the SARFAESI Act, 2002 enable the bank to take possession of any property where a security interest has been created in its favour. Specifically, section 13 of the 2002 act enables the bank to take possession of and sell such property to any person to realize it’s dues. The purchaser of such property acquires a clear title to the property sold, subject to compliance with the requirements prescribed.
Dishonoured post dated cheque described as a security for the repayment of a loan instalment falls within the scope of section 138 of the Negotiable Instruments Act 1881
The supreme court in Sampelly satyanarayannaRao v/s Indian Renewable Energy Development Agency Limited AIR 2016, ruled that a dishonoured post dated cheque described as a security for the repayment of a loan installment in the loan agreement falls within the scope of section 138 of the Negotiable Instruments Act 1881 and as such the drawer who issues cheque as a security for payment of installment without sufficient balance in the account shall be criminally liable for the dishonour of such cheque under section 138 of the Negotiable Instruments Act 1881.
Author, Vishal Tinani.