SARFAESI Act | As per Unamended S.13(8), Borrower Has Right To Redeem Available Till Sale Certificate Is Registered & Possession Is Handed Over : Supreme Court

The Supreme Court, while deciding an appeal, settled the issue of right of redemption of a mortgaged property by a borrower under the unamended Section 13 of the Securitization and Reconstruction of Financial Assets and Enforcement of Securities Interest Act, 2002. The Bench comprising of Justices Vikram Nath and Rajesh Bindal clearly held that as per the unamended Section 13 of the SARFAESI Act, the right of borrower to redeem the mortgaged property would be available until the sale certificate is registered and the possession is handed over. “The net result is that the right of the Borrower to redeem would be available till the sale certificate is registered and the possession is handed over after which the Borrower will not have a right for redemption under the unamended provision of Section 13 of the SARFAESI Act.” In the present case, the concerned property was mortgaged to the Bank/ Respondent no. They are as follows: “ the confirmation of sale by the Bank under Rule 9 of the Rules of 2002 invest the successful auction purchaser with a vested right to obtain a certificate of sale of the immovable property in form given in appendix to the Rules i.e., in accordance with Rule 9 of the SARFAESI.” “ In accordance with the unamended Section 13 of the SARFAESI Act, the right of the borrower to redeem the secured asset was available till the sale or transfer of such secured asset. Based on these facts and circumstances, the Court ruled in favour of the borrowers and categorically held that right of the Borrower, under the unamended provision of Section 13 of the SARFAESI Act., to redeem would be available till the sale certificate is registered and the possession is handed over.