Make an offer for one time settlement with bank
2) bank would not settle for amount less than market value of mortgaged property
3) better borrow some money from relatives and settle for principal amount of loan
Regarding DRT
Respected Sir/Madam, I have borrowed Rs.1,37,00,000 from Canara Bank in the year 2016 for purchasing of farm machinery for agriculture purpose by morgaging my home and agricultural land. I have payed around Rs.70,00,000. Now my loan account has went NPA on 2021 and now the bank has moved to DRT with a claim of 1.8 Crore. I have only one son who was diagnosed with bone cancer in the year 2017 now after many surgeries now he is suffering for post operative knee joint infection. I have made tie-up for my farm machinery which is an sugarcane havester with local sugar factory on the year 2016 which had went bankrupt in the year 2019. Currently my sugarcane harvester is not in a running condition. Will I can close my loan by paying around 50 lakhs with bank or I need to do any step for the case which was filed against me in DRT. I cannot afford more than 50 lakhs also for this itself I should borrow from my friends.
Asked 1 year ago in Civil Law
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12 Answers
They can’t sell or apply Sarfesi act on agricultural land in DRT
Dear Client,
Negotiation with the Bank: It's possible that you might be able to negotiate with the bank for a settlement amount, especially if you're unable to repay the entire outstanding loan. Discussing your financial constraints and the health issues affecting your family, especially your son's condition, with the bank might lead to some flexibility in repayment terms.
DRT Proceedings: Debt Recovery Tribunal is a legal forum specifically designed for resolving disputes related to debt recovery. The bank initiates the proceedings in DRT to recover the outstanding loan amount. You will need to respond to the proceedings and present your side of the case.
Legal Representation: it's highly advisable to engage a lawyer who specializes in DRT cases to appear. They can guide you through the legal process, help you present your case effectively, and explore potential solutions, including negotiations with the bank.
Financial Hardship: You might be able to present your financial hardship as a defense in the DRT proceedings. Explain your son's medical condition, your inability to work, and the impact on your income and repayment capacity.
Settlement Proposal: If you are unable to repay the entire loan amount, you could propose a settlement to the bank, where you offer a lump-sum payment (such as the 50 lakhs you mentioned) in lieu of the full outstanding amount. This is something you would typically negotiate with the bank's legal team.
Documentation: Make sure you have all relevant documentation related to the loan, your repayment history, your son's medical condition, and any correspondence with the bank. This will be crucial for presenting your case effectively.
- As per the RBI, the bank should give proper time and offers for the settlement of loan amount. on the ground of health and sudden loss.
- Hence, you can mention before the DRT for your inability to pay the said amount after submitting the medical proofs of your son , and the bank cannot refuse for the same as mostly loans are insured .
You can negotiate with the bank for one time settlement.
If bank do not agree for your terms, then you can vent out your grievances before DRT which would include your son's health condition and your commitments towards his medication and medical treatment .
If the collateral property is not worth the loan dues then bank may come down to your offer for settlement to some extent
Respected Sir/Madam, Is there any possibility that DRT can allow bank to auction my agriculture land as it is the only source of funds for my son's treatment and for my family's day to day expenses.
Asked 1 year ago
If land is being used for agricultural activities then agricultural land would not be auctioned under SARFESI act
The Supreme Court held that, in SARFAESI proceedings, the burden is upon the borrower to prove that the secured properties are agricultural lands
he Supreme Court has once again reiterated that for a land to be considered as "agricultural" and therefore exempt under Section 31 of SARFAESI, the borrower should be able to prove that the land is actually put to use as an agricultural land or agricultural activities are ongoing on such land
Whether a parcel of land is agricultural must be deduced as a matter of fact from the nature of the land, the use to which it was being put on the date of the creation of the security interest and the purpose for which it was set apart.”
You can try for OTS with bank and can also take liberty to pay in installments. You can also enroute your proposal through DRT.
Offer One time settlement in court for 50lacs. Agriculture land cannot be attach.
Haven`t bank issued sec 13(4) notice to take possession of your house ?
- Since, the said agriculture land is also mortgaged with the bank , then the bank can auction the said land for the recovery of the remaining amount.
- However, you can submit your reply after stating the true facts of the treatment of your son before the DRT and prayed for settle the case on the humanitarian grounds.
- If refused , then you can even write to the RBI for the same.
No agricultural land can’t be auctioned under sarfesi act
You have the option to apply for a loan through the bank's Off-The-Shelf (OTS) program, and you are free to choose a convenient installment payment plan. Additionally, if you prefer, you can consider routing your proposal through the Debt Recovery Tribunal (DRT) for further consideration.