Reacting to the Supreme Court judgment in the matter of Sarfaesi Act, RBI central board director and veteran cooperator Satish Marathe said if this had been done in the past, huge expenses incurred by Cooperative Banks could have been avoided. Recovery could have been expedited and precious time would not have been lost, Marathe added.
Sharing his reaction through WhatsApp Marathe further wrote, “We, at Sahakar Bharati have been requesting the GOI for the past few years, to amend the Act to give clarity and include all Cooperative Banks”.
“On several occasions, Co-op Banks do not get mentioned in Central Legislations just because there is No Division/Section/Secretariat in the Dept of Financial Services in the Ministry of Finance to handle issues relating to Co-op Banks”, Marathe underlined.
“We have written letters and raised the issue also before the Finance Minister Mrs Nirmala Sitharamna in the past. Sahakar Bharati again demands immediate establishment of a suitable set up in the Dept of Financial Services”, he further wrote.
Marathe added that, The Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest (Sarfaesi) Act, 2002, allow banks and financial institutions to auction properties (residential and commercial) when borrowers fail to repay their loans. It enables banks to reduce their non-performing assets by adopting measures for recovery or reconstruction.
The Sarfaesi Act allows secured creditors to take possession of the assets of a borrower who fails to pay dues within 60 days of demanding repayment.
Besides, Marathe thanked the Nafcub team in particular and its President Jyotindra Mehta in general for getting justice to Co-op Banks.
Meanwhile, sharing his reaction on his development, Manvi UCB Chairman Thimmaiah Shetty said, “The judgement passed by the Supreme Court on applicability of Sarfaesi Act is a welcome decision. With this the recovery of NPA will improve. Thanks to Jyotindrabhai Mehta. For the efforts in getting expert Advocate and winning the case”, he added.
Another cooperator, Umesh Chand Asawa, MD, AP Mahesh Cooperative Bank said, It will now be simple and easy SARFAESI Act procedures to follow for recovery. No need to depend on the state government’s office for Recovery which is very cumbersome. Now Recovery of Npa will be fast and help co-op banks to control NPA”.
Keshav Sahakari Bank, Chairman, Prakash Gulati reacted that, “Great achievement of Nafcub , Respected Shri Mehta Saheb, Respected Shri laxmi Dass ji and all members . This decision has solved disputes. All urban cooperative Banks are eligible to recover their loan via this route also”.
Readers would recall that a long drawn out legal battle has come to an end with the Hon’ble Supreme Court pronouncing that the SARFESAI Act is applicable to c-ooperative banks and that the cooperative banks can proceed against the delinquent borrowers for recovery under the Act.
A GREAT achievement .NAFCUB has done remarkable task.This will certainly helps to all the Urban Bank to realise their outstanding .Urban Bank those was unable to take the advantage of SARFAESI now they can enjoy it’s power.