Why bad loans can now be better dealt with -Governance Now

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

Report of India’s G20 Task Force on Digital Public Infrastructure released

The final ‘Report of India’s G20 Task Force on Digital Public Infrastructure’ by ‘India’s G20 Task Force on Digital Public Infrastructure for Economic Transformation, Financial Inclusion and Development’ was released in New Delhi on Monday. The Task Force was led by the

How the Great War of Mahabharata was actually a world war

Mahabharata: A World War By Gaurang Damani Sanganak Prakashan, 317 pages, Rs 300 Gaurang Damani, a Mumbai-based el

Budget expectations, from job creation to tax reforms…

With the return of the NDA to power in the recently concluded Lok Sabha elections, all eyes are now on finance minister Nirmala Sitharaman’s full budget for the FY 2024-25. The interim budget presented in February was a typical vote-on-accounts, allowing the outgoing government to manage expenses in

How to transform rural landscapes, design 5G intelligent villages

Futuristic technologies such as 5G are already here. While urban users are reaping their benefits, these technologies also have a potential to transform rural areas. How to unleash that potential is the question. That was the focus of a workshop – “Transforming Rural Landscape:

PM Modi visits Rosatom Pavilion at VDNKh in Moscow

Prime minister Narendra Modi, accompanied by president Vladimir Putin, visited the All Russian Exhibition Centre, VDNKh, in Moscow Tuesday. The two leaders toured the Rosatom Pavilion at VDNKh. The Rosatom pavilion, inaugurated in November 2023, is one of the largest exhibitions on the histo

Let us pledge to do what we can for environment: President

President Droupadi Murmu on Monday morning spent some time at the sea beach of the holy city of Puri, a day after participating in the annual Rath Yatra. Later she penned her thoughts about the experience of being in close commune with nature. In a message posted on X, she said: