SARFAESI Act is silent on the is­sue

HT Estates - - FRONT PAGE -

The Se­cu­ri­ti­sa­tion and Re­con­struc­tion of Fi­nan­cial As­sets and En­force­ment of Se­cu­ri­ties Act, 2002 ( SARFAESI), un­for­tu­nately, does not have any spe­cific pe­nal pro­vi­sions against of­fi­cials of lend­ing in­sti­tu­tions who don’t cross-check with Cen­tral Registry of Se­cu­ri­ti­sa­tion As­set Re­con­struc­tion and Se­cu­rity In­ter­est of In­dia (CERSAI) for sta­tus of a pop­erty and grant a loan for it.

RV Verma, MD and CEO and CERSAI, ex­plains: “It is ex­pected that the lend­ing in­sti­tu­tions will ver­ify and cross-check the sta­tus of prop­er­ties on the Cen­tral Registry site. And there are other laws and reg­u­la­tions to deal with crim­i­nal ac­tions and frauds etc.”

How­ever, if an of­fi­cer ap­proves a l oan f or a property and fails to send the de­tails to CERSAI, he or she can be pe­nalised as the Act states that ‘ev­ery de­fault­ing com­pany and of­fi­cial of the com­pany or the se­cured cred­i­tor and ev­ery of­fi­cer of the se­cured cred­i­tor not com­ply­ing with the rules shall be pun­ish­able with a fine which may ex­tend to ` 5000 for each day of de­fault.’

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