Banking & DRT Lawyers in Ahmedabad — SARFAESI, Recovery & Defence
on the lender’s side and the borrower’s.
Candour Legal acts in secured-debt enforcement and recovery — for banks, NBFCs and asset reconstruction companies enforcing security under the SARFAESI Act, and for borrowers and guarantors defending against it. We appear before the Debts Recovery Tribunals at Ahmedabad, the DRAT, and the Gujarat High Court, and we negotiate the settlements that resolve most of these matters before they reach judgment.
Who we act for
Lenders — banks, NBFCs, housing finance companies and asset reconstruction companies enforcing security interests, filing recovery applications, and executing recovery certificates. Borrowers and promoters — companies and individuals facing SARFAESI notices, possession measures or DRT proceedings, who need the enforcement tested and a commercial resolution built. Guarantors — personal and corporate guarantors pursued for company debts, often years after the guarantee was signed.
Acting on both sides is the point. A defence is stronger when you know how enforcement files are actually built, and an enforcement is cleaner when you know where borrowers attack it.
What we handle
Eight core workstreams across SARFAESI, the DRT and settlement.
SARFAESI enforcement — for lenders
Section 13(2) demand notices drafted to withstand challenge, replies to borrower representations under Section 13(3A), enforcement measures under Section 13(4), applications to the Magistrate under Section 14 for possession assistance, and sale of secured assets in compliance with the Security Interest (Enforcement) Rules.
SARFAESI defence — Section 17 applications
Challenging enforcement before the DRT within the 45-day limitation — defective notices, incorrect account classification, valuation and sale-process irregularities, and interim protection against possession and sale while the application is heard.
DRT recovery applications
Original applications under the Recovery of Debts and Bankruptcy Act, 1993 for debts of ₹20 lakh and above — pleadings, evidence, interim orders, and prosecution through to the recovery certificate.
DRT defence & counterclaims
Defending recovery applications — contesting the debt and its computation, limitation, set-off and counterclaims, and the procedural discipline that DRT matters reward.
One-time settlements & restructuring
Negotiating OTS proposals and compromise settlements with banks and ARCs — building the proposal, the payment structure and the documentation, so the settlement actually closes the account and releases the security and the guarantees.
Guarantor liability
Advising and defending personal and corporate guarantors — the scope and enforceability of the guarantee, discharge arguments, proceedings under the SARFAESI Act and RDB Act, and personal-guarantor insolvency under Section 95 of the IBC through our NCLT practice.
DRAT appeals
Appeals to the Debts Recovery Appellate Tribunal — including the pre-deposit requirement under Section 18 of the SARFAESI Act, where the tribunal may reduce the deposit but not below 25% of the debt due — and writ proceedings before the Gujarat High Court where the jurisdictional threshold is met.
The SARFAESI–IBC interface
Advising lenders and borrowers where remedies run in parallel — the effect of a Section 14 IBC moratorium on SARFAESI enforcement, choosing between the DRT route and a Section 7 petition, and sequencing remedies rather than duplicating them.
How SARFAESI enforcement runs
The statutory sequence — and where each side’s opportunities sit.
Enforcement under the SARFAESI Act follows classification of the account as a non-performing asset. Classification disputes are among the first lines of defence.
The secured creditor demands the dues; the borrower has 60 days. A representation can be made, and the lender must reply to it under Section 13(3A). Most settlements begin in this window.
On expiry, the lender may take possession of the secured asset and proceed to sale, with Magistrate assistance under Section 14 where needed. The Enforcement Rules govern every step — and every step can be tested.
Any person aggrieved by enforcement measures may apply to the DRT within 45 days. Interim orders here decide whether possession and sale proceed while the challenge is heard.
Orders travel to the DRAT — with the Section 18 pre-deposit — and, on jurisdictional grounds, to the High Court. Parallel OTS discussions often continue throughout.
Why Candour Legal for banking & DRT matters
We appear regularly before the Debts Recovery Tribunals at Ahmedabad and the Gujarat High Court, for lenders and borrowers alike.
We build enforcement files for lenders and dismantle them for borrowers. Each side of the practice sharpens the other.
Most recovery matters end in a negotiated resolution. We treat the OTS as a piece of legal work — structured, documented, and closed properly.
We publish continuing analysis of RBI directions and financial-sector regulation, and it informs how we read a lender’s file.
Frequently Asked Questions
What clients ask us about SARFAESI and DRT proceedings — answered directly.
What is the SARFAESI Act and when can a bank use it?
The Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 lets secured creditors enforce security interests — typically mortgaged property — without first obtaining a court decree. It applies once the borrower’s account is classified as a non-performing asset, and enforcement proceeds through the notice and possession sequence in Section 13, subject to the borrower’s right to challenge before the DRT.
What is a Section 13(2) notice and what should a borrower do about it?
It is the demand notice that starts SARFAESI enforcement, giving the borrower 60 days to discharge the dues. A borrower should treat it as the strategic moment it is: make a considered representation — which the lender must answer under Section 13(3A) — verify the account classification and the computation, and open settlement discussions while options remain widest. Silence in the 60-day window surrenders the initiative.
Can SARFAESI action be challenged?
Yes. Any person aggrieved by measures under Section 13(4) — possession, sale steps — may apply to the Debts Recovery Tribunal under Section 17 within 45 days. Common grounds include defective or premature notices, wrongful NPA classification, valuation and auction irregularities, and non-compliance with the Security Interest (Enforcement) Rules. Interim protection is often the practical heart of the application.
When does a recovery matter go to the DRT instead of a civil court?
Banks and notified financial institutions recover debts of ₹20 lakh and above through original applications before the Debts Recovery Tribunal under the Recovery of Debts and Bankruptcy Act, 1993 — the civil court’s jurisdiction is barred for those claims. Recovery below that threshold, and suits by lenders outside the Act, proceed through the ordinary courts, which we also handle.
What is the pre-deposit for a DRAT appeal?
Under Section 18 of the SARFAESI Act, an appeal to the DRAT requires deposit of 50% of the debt due as claimed or determined, which the tribunal may reduce for reasons recorded — but not below 25%. The pre-deposit is frequently the decisive practical question in appeal strategy, and we advise on it before the appeal is drafted, not after.
What is a one-time settlement and how does it work?
An OTS is a negotiated compromise in which the lender accepts a defined amount — usually staged — in full and final settlement of the account. Banks evaluate proposals against their internal settlement policies and the realisable value of the security. The legal work is in the structure and the documentation: payment milestones, consequences of default, release of security and of guarantors, and closure of pending proceedings. A badly documented OTS simply produces the next dispute.
The bank has started both SARFAESI and IBC proceedings. What does that mean?
The remedies can run in parallel, but they interact. If a company enters the corporate insolvency resolution process, the moratorium under Section 14 of the IBC stays SARFAESI enforcement against the corporate debtor for its duration — though proceedings against guarantors stand on a different footing. Which forum leads, and in what sequence, is a strategic choice for both sides; we advise on it together with our NCLT practice.
Discuss your recovery matter
Whether you are enforcing a security interest, answering a Section 13(2) notice, or negotiating a settlement — the first weeks set the terms of everything after. Start with a conference.
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