Beware of Housing Finance Companies they can takeover your house

By a Staff Reporter

The amendment of the Securitisation and Reconstruction of financial assets & enforcement security Act 2002, has been assailed by Advocate Sanjeev Kanchan, the president of the Citizens’ Organisation of Public Opinion (COPO).

Lashing out at the amended act, Mr Kanchan pointed out that now the Housing Finance Companies can take over any house without going to Court and drive the owner out of his house.

To galvanise  the public opinion, the (COPO) organised a public seminar at the Indian Merchant Chamber hall recently, which was addressed among others by justice Dr Pratibha Upasani, chairperson, debt recovery appellate  tribunal, prominent advocates Jai Chinai and DD Menon.

Under the act, the government has permitted the Banks and Housing Finance Companies to take possession of mortgaged properties and flats by dispossessing their occupiers and sell the same without the intervention of the Court. by giving 60 days notice and the mortgagers are debarred from contesting the notice and they can go to the court only after they are dispossessed and the properties are taken over by the Banks.

All the speakers in the meeting castigated the amended act and said it is very harmful to the property rights and demanded its immediate repeal.

They pointed out that under the municipal act, even the unauthorised slum dwellers can challenge eviction notice under Section 351 of B.M.C Act, but those who borrow money from financial agencies no more enjoy these rights.

Mr Kanchan, later speaking exclusively to Accommodation Times revealed that the Supreme Court by its decision dated 7.4.204 in Merdia Chemicals case decided that the provision of deposit of 75 percent of claim amount for challenging the taking over of the mortgaged property is invalid.  To nullify the effect of Supreme Court judgment the government of India prescribed in the amended Section 18 of the Act to deposit 50 percent of claim amount.

The COPO members condemned the provision that the mortgager must have the right to challenge the amount claimed by the Banks & Finance institutions.  The demand of 50 percent of claim amount as deposit (without adjudicating it) for filing the appeal that too after the properties are taken over by the Bank is `arbitrary, oppressive and outrageous’,  charged the speakers.