CONCURRENT AUDIT

COURSE
Internal Audit Standard Board.

By T K Basu

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Types of Banking Institutions
 Commercial Bank
 Regional rural Bank
 Co-operative Bank
 Development Bank (Term lending institutions)
 Exim Bank
Small payment banks.

Private sectors bank – Old – Which was not nationalized – new due to liberalized policy RBI
allowed private bank to operate in a minimum paid up capital of Rs. 200 crores which will be
raised to 300 cores within 3 years of commencement of business.For small finance Banks
Capital requirement is Rs 200 cores.

Foreign Banks –

Central bank of the country ( RBI)

Regional Rural Bank (RRB) –
1) set up by RRB act 1976
2) Public sector bank participating in their capital and also staffing them .
3) RRB should maintain capital to Risk weighted Assets of 9%( Tier i & Tier II) on
ongoing basis. Authorised capital enhanced from Rs 5 Cores to Rs 2000 cores.

Co-operative Bank- set up by members ,catering small loans.

Specialized financial institutions & Developments Bank – UTI , LIC, GIC, IDBI, IFCI etc.
State level Financial institution governed by SFCI act 1951
Legal Framework
 As per section 5(c) of the banking regulation act – “ any company which transacts the
business of banking in India”.
 The word banking is “accepting, for the purpose of lending of investment of deposits of
money from public, repayable on demand or otherwise, at withdrawal by cheque , draft,
order or otherwise”- section 5(b)
 Section 6(a/1) also provides that banking company may do all such other thing as are
incidental or conducive to the promotion or advancement of the business of the
company. Beside that central government may notify any other form of business which is
lawful for a banking company.
 Section 22 provides banking company must hold license.
A Brief of Banking in India
Bank of Hindustan (1770) 1st Bank in India.
 The swadesi movement gave stimulus of growth of banking system in India.
 RBI act was passed in 1934 and RBI came into existence in 1935.
 RBI is the central bank of the country & managing the operations of the
internal banking.
 In July 1969 , 14 major banks were nationalized and 6 more banks were nationalized subsequently. 14
banks were nationalized under banking companies ( acquisition and transfer of undertaking) act, 1970 and
6 bank were nationalized under the banking companies acquisition & transfer of undertaking Act,
1980.From 01.04.2020 as per decision of Central Govt a few banks merged together& at present there are
only 10 banks( Nationalized)
Banking Regulation Act
Section 6 of the Act :- Forms of Business a banking
company may engage,
Borrowing , raising or taking of money
Giving advance
Bills Business
Letter of Credit , Bank Guarantee , Indemnity.
Foreign Exchange
Safe deposit vault
Collecting and Transmitting money

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 Cont....
Managing Selling , realizing accruing, holding, dealing
with any kind of property
Undertaking and executive trust
Accruing etc of Building for the purpose of bank
Any other purpose as notified by the central
government.

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Section 8 of the BR Act
A Banking Company Shall not directly or indirectly
dealing the buying or selling or bartering of goods
except in connection with the realization of security
given to it.
Section 9
A banking Company can hold immovable property for
its own use
Otherwise up to a period as per RBI Approval .
Section 15
Restriction on payment of Dividend till all capitalized
expenses writtenoff

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Section 17
Creation of reserve at least 20% of the profit.
Section 18
Maintains of Cash reserve with itself or in the current
account in the RBI/Other banks. A sum equivalent to at
least 3% of time and demand liabilities. ( AMMENDED IN
March 2020)
Section 20
Cannot grant loans and advances on the security of its own
shares/to directors or directors interest in other companies.
Section 24
Maintenance of SLR(% of demand and time liabilities time
to time Changed by RBI) at present 18.50%( ammended in
March 20 )
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Section 35
Power to inspect the books of accounts.

RBI ACT

Functions of RBI
Issue of Currency
Development role
Banker to government & Bank
Formulate of monetary Policy and inflation control
Manager of Foreign reserve clearing house function
Regulation of banking system.

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Section 22 of RBI Act
The RBI has got the sole power to issue the banks
notes.
Section 24 of RBI Act
Denomination of notes decided by the RBI
Section 42 of RBI Act
CRR to be kept with RBI.

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Power to suspend operation of the act (section 4)
Section 11- requirement as to minimum paid up
capital &reserve
Section 23- restriction on opening & transfer of
places of business.
Section 35- inspection by RBI
Section 35a- Power of the RBI to give directions
 Section 29- accounts & audit
 01.05.2020

CERTIFICATE COURSE ON
CONCURRENT AUDIT Legal Framework
IASB OF ICAI

13
 Way Ahead. . .

Legal & Regulatory Framework – Role

Salient provisions of some statutes

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 Role of Concurrent Auditors
How many statues come into play ?
Legal Audit ?
Compliance testing ?
Law Vs Practice ?
Operational part of law in routine work
Omissions / commissions in practice
Impairing impact on assets
Observations / suggestions for further review

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 Legal Framework - overview . . .
Salient provisions of
Transfer of Property Act, 1882
Powers of Attorney Act. 1882
Indian Stamp Act, 1899
The Recovery of Debts Due to Banks and
Financial Institutions Act, 1993
The Credit Information Companies (Regulation)
Act, 2005
The Securitisation and Reconstruction of Financial
Assets and Enforcement of Security Interest Act,
2002

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 Laws relating to
securities and modes
of charging
Transfer of Property Act, 1882
Indian Contract Act, 1872
SARFAESI

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 Transfer of Property Act
1.Came into force on 1st July 1882

2. Objective
a)Regulate transfer of property between living person
b)Complete the code of conduct law for immovable
property

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2. Types of property transfers

1.a) transfer of property by operation of law

Inheritance
 Insolvency
 Forfeiture
 Sale in execution of decree
 By Will
b) Voluntary transfer of property by act of parties
Sale
 Mortgage
 Gift
 Exchange
 Charge
Transfer property applies only to this 2nd
nd category.

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 Overview of charges
Nature of Types of security Kind of Defined in Act
security Charge
Immoveable Land and building Mortgage Sec 58, Transfer of Property
property Act

Actionable claims Book debts, term deposit Assignment Sec 130, Transfer of Property
(i.e. unsecured receipts, etc. Act
debts)

Moveable property/ Plant & machinery, stocks, Pledge/ Pledge-Sec 172 Indian
goods vehicles, etc. hypothecation/ Contract Act
lien Hypothecation – Sec 2(n)
SARFAESI

Paper securities Shares, debentures, MF, Lien Sec 170 and 171Indian
bonds Contract Act

Personal guarantee Promoters & 3rd party Personal liability Sec 126 Indian Contract Act
guarantees

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 Kinds of charges – Fixed v/s Floating
Fixed charge
Created on properties such as land and
buildings, plant and machinery
Identity does not change
Debtor retains ownership and possession

Floating charge
Created on assets that undergo change
Security allowed to be used in ordinary
course of business unless charge crystallises

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 Kinds of charges
Pari Passu charge
Several creditors- typically in consortium /Multiple finance accounts
Equal priority

Exclusive charge
To one creditor
No intervention of other creditors

First charge
First right over the proceeds from the security charged

Second charge
Rights subject to those of first charge holder

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Mortgage
Dealt with in Transfer of Property Act, 1882
Section 58
“A mortgage is the transfer of interest in
specific immoveable property, for the
purpose of securing the payment of money
advanced or to be advanced by way of
loan, on existing or future debt or the
performance of an engagement which may
give rise to pecuniary liability”

23
 Mortgage
Types
Simple
Conditional sale
Usufructuary mortgage
English mortgage
Equitable Mortgage
Anomalous mortgage

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 Simple Mortgage
 “Where, Without delivering possession of the mortgaged property, the
mortgager binds himself personally to pay the mortgage money and
agrees, expressly or impliedly, that in the event of his failing to pay
according to his contract, the mortgagee shall have a right to cause the
mortgaged property to be sold by a decree of the court in a suit and the
proceeds of the sale to be applied so far as may be necessary in payment
of the mortgage money” [Sec 58(b)]
Intervention of court required
Mortgagee has no right to get any payments out of
the rents and produce of the mortgaged property
Mortgagee not put in possession of the property
Registration is mandatory

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 Conditional Sale
 “The mortgager ostensibly sells the mortgaged property on the
condition that:
(a) on default of payment of the mortgage money on a certain
date, the sale shall become absolute, or
(b) on such payment being made the sale shall become void, or
(c) On such payment being made, the buyer shall transfer the
property to the seller” [Sec 58(c)]
Sale is ostensible – not real
If money not paid ostensible sale shall become
absolute – Court decree required
No personal liability for repayment of the loan

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 Usufructuary mortgage
 “mortgage transaction in which
(a) the mortgager delivers possession expressly, or by implication binds himself to
deliver possession of the mortgaged property to the mortgagee, and
(b) Authorises the mortgagee to retain such possession until payment of the
mortgage money and to receive the rents and profits accruing from the property
or any part of such rents and profits and to appropriate the same in lieu of
interest, or in payment of the mortgage money, or partly in lieu of interest and
partly in payment of the mortgage money” [Sec 58(d)]

Mortgagee in actual legal possession of the property,

till dues are repaid
Mortgagee has the right to receive rents and profits
accruing from the property
No personal liability of the mortgager
No time limit specified

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 English mortgage
 “mortgagee binds himself to repay the mortgage money on a certain
date, and transfers the mortgaged property absolutely to the
mortgagee, but subject to the provisio that he will re-transfer it to the
mortgagee upon payment of the mortgage money as agreed” [Sec
58(e)]

Personal covenant to pay on a specified date

notwithstanding the absolute transfer of
property to the mortgagee
Absolute transfer
Subject to re -conveyance in event of repayment
Court decree for sale

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 Equitable mortgage
 “where a person delivers to a creditor or his agent documents of title to
immoveable property, with the intent to create a security thereon, the
transaction is called a mortgage by deposit of title deeds” [Sec 58(f )]

Deposit of title deed with intention to secure

debt
Original deed needs to be deposited
Saves on stamp duty
Deposit at notified places only
Independent of location of the property

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 Anomalous mortgage
“a mortgage which is not a simple mortgage, a mortgage by
conditional sale and Usufructuary mortgage and English mortgage
or a mortgage by deposit of title deeds within the meaning of this
section” [Sec 58(g)]

Should satisfy the basic definition of

mortgage
Should not fall in the earlier categories
Usually a combination of two mortgages

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 Mortgages- Other key aspects
Registration requirements
Registration required for mortgages other than
equitable mortgage – Sec 59
Indian Registration Act- Sec 23 - required
within 4 months of execution
In case of Company registration of charge is
required_
Companies Act, 2013-Sec 77- within 30 days of
execution

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 Mortgages- Other key aspects
 Most prevalent are Simple & Equitable Mortgage
 Ensure clear title report by panel advocate – 30 years tracing
 Revenue extracts can not be treated as title deeds – originals title
deeds required
 EM – attendance of Mortgager in the bank – sign EM Reg
 Memorandum of deposit – on a subsequent date – by mortgager or
in some banks by bank officers
 Both signing will make it simple mortgage – stamp duty
 In some states there is Stamp Duty on EM
 Memorandum is registered in some states

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 Which Mortgage would you prefer?

Mortgage Personal Liability Possession

Simple Mortgage  
Conditional Sale  
Usufructuary Mortgage  
English Mortgage  
Equitable Mortgage  
(Court decisions) (Deposit of title deeds)

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 Assignment
Transfer of actionable claim
Claim to (Book) debt or other actionable claim
 secured by mortgage of immoveable property
 Hypothecation/ pledge of moveable property not in

possession
Key features
Should be in writing
Due notice to be given to the debtor
Assignor cannot give better title
eg LIC policies used as security

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 Pledge
“Pledge is the bailment (delivery) of goods as security
for payment of a debt or performance of a promise”
(u/s 172 of Indian Contracts Act)
Key aspects
Delivery of goods
 Need to be physical delivery in general

 May be constructive delivery – eg handing over keys of

godown
 Can only be on existing goods- not on future goods

Pawnor – borrower who gives the goods as security

Pawnee- lender who takes the goods as security
…. continued

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 Pledge
Ownership retained with pawnor
Possession with pawnee
 Possession may be parted with against Trust
Receipt
 Right to retain or sell goods where pawnor makes

default in payment
 Notice to sell required to be given
 Right of pledge prevails over any other dues

including Government dues except workers

wages

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 Hypothecation
Defined in SARFAESI, 2002 (Sec 2(n))
Charge upon moveable property
Existing/ future
Without delivery – possession with borrower

Demerits
Risk of fraud- multiple charges on same property
Erosion of security value

Precautions
Periodic stock statements
Registration of charge( In case of Co)
Notice of charge
Insurance of property/Inspection

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 Lien
General Lien
Creditor’s right to retain property of debtor
Possession in ordinary course of business
Limited to possession of property – not to sell

Banker’s lien
General lien+ right to sell
Applicable to negotiable instruments and credit balances
Not applicable to safe deposit

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 Indian Stamp Act 1899

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 Stamping of documents
Stamp duty – tax levied on documents
Originated in Netherlands – 1624
France (1654), Denmark (1657), Prussia (1682)
Key aspects
Amount of duty – given in schedule – revised
periodically
Type of stamp used - specified
Cancellation of stamp – Sec 12- initials, sign
Time of stamping and execution
Place of stamping and execution

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Stamp Duty
Stamp duty it is a kind of tax, which is paid to state government
For the transaction performed by way of document or
instrument under the provision of Bombay stamp act 1958 &
Indian stamp act 1899.

Instrument

Instrument means any document by which any right or liability

is, or purports to be created, transferred, limited, extended, is
or purports to be created, transferred, limited, extended,
extinguished or recorded.

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 Indian Stamp Act 1899

It is fiscal statue laying down the law related to tax levied
in the forms of stamps on instrument recording
transaction.

a) That is stamp duty payable on documents specified in

Entry 91 of the union list ( Bill of exchange, promissory
note, Bill of lading, LC, Insurance policy, Transfer of
share, debenture etc.

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 Stamping of documents
 Stamp duty obtained on a date prior to execution of
document
 Purchased in name of borrower / bank

 Consequences
 Admissibility as evidence – Sec 35, subject to penalty,
exceptions
 Improper/ inadequate stamping - Adjudication –
Collector – within 30 days
 Prosecution – if intention to evade is proved
 Penalty for non cancellation - Sec 63

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 Instruments which Attract Stamp duty

 Agreements
 Conveyances
 Exchange
 Gift
 Certificate of Sale
 Deed of Partition
 Power of Attorney
 Deed of Settlement

Who are Liable to Pay Stamp Duty

1. Purchaser
2. In case of lease or Agreement by the lessee.
3. In case of exchange it is paid to by the both parties

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Time & Mode of Payment

1. Stamp duty to be paid before or at the

time of execution or on the next
working day following the day of
execution.
2. Stamp to be purchased in the name of
one of the executers .

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 The Powers-of-Attorney Act 1882

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Need & implication
 The business & commerce would have come to standstill if
 People had to be every where to perform all tasks themselves.
 So we need to have some agency authorised to represents
 for various business or legal purposes
 In other word we need to give somebody POWER to act on
 Our behalf & also to specify the limit within which the said
 person can act on our behalf.
 Thus power of attorney legally defined as the “Authority
 where by one is said in the turn/ stead our place of another to
act for him”’

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Applicability
 The powers of attorney act 1882 is applicable to entire country
except J & K
Types of POA:- General & Special
General
It authorized a person to act on behalf of principal person in
all matter of a particular nature or generally in respect of
general business.
Special
It authorizes the representative person to represent the
principal party only in context of some particulars specified
activity

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 Power of Attorney
Types
General v/s special
Acts done by donee are treated to be done by donor of power –
Sec 2
Acts done in good faith are binding even after death, insolvency,
unsound mind etc – without knowledge of donee. Sec 3
Registration when sale of property is involved.
Deposit with court – certified copies – Sec 4
Precautions
Scope of powers
Agent acting within the scope of powers
Confirmation of validity & ratification of actions

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 Recovery of Debts due to
Banks and Financial
Institutions Act, 1993

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 R D D B & F I Act, 1993
 An Act to provide for the establishment of Tribunals
for expeditious adjudication and recovery of debts
due to banks and financial institutions and for
matters connected therewith or incidental thereto.
 Extends to whole of India – except J & K
 Act shall not apply -
 debt due to any bank or FI or to a consortium of banks
or FIs is less than ten lakh rupees or such other
amount, being not less than one lakh rupees, as the
Central Government may, by notification, specify

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 R D D B & F I Act, 1993
Establishment of DRT & Jurisdiction
Only one member - Presiding Officer
Tribunal may pass interim orders of
Injunction, stay, attachment etc
Disposal in 180 days
Appeal against DRT order lies with DRAT –
within 45 days
Order of DRAT in 6 months

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 R D D B & F I Act, 1993
Borrower going to DRT to deposit 75% of
the debt due
DRT has powers as that of Civil Courts – but
need not follow CPC procedures
Recovery officer to recover dues by
attachment, arrest, appointing receiver

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 The Credit Information
Companies (Regulation) Act,
2005

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 C I C(Regulation) Act, 2005
 Objective- regulation of credit information companies
 Registration
 Compulsory registration with RBI
 Existing companies to apply within 6 months
 Conditions
 Minimum capital – Rs. 30 crore (authorised), Rs.20

crore(issued)
 Management not prejudicial to interests of users, clients or

borrowers, credit information companies

 Additional conditions at discretion of RBI

 RBI may determine cap on maximum number of credit

information companies
 RBI may cancel registration
 Appeal lies with Central Government

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 RBI Powers
Registration and cancellation
Frame policy and regulations
Give directions
Inspection
Appoint observers
Supersede board – appoint administrator
Specify maximum fee
Recommend exemption and rules

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 Functions
Permitted businesses
Collect information on trade, credit and standing of borrowers of member
credit institutions
Provide
 Information to specific users, credit institutions
 Credit scoring

Research projects
Other business specified by RBI

Membership
Credit institutions to become members
Compulsory to be member of at least one
Bound to give information

Disclosure of credit information restricted

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 Information Privacy Principles
Accuracy and secrecy of credit information

Alteration of credit information

Credit information to be supplied by credit
institutions
Borrower may request updation

Fine for unauthorised access

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 C I C Regulations, 2006
Specified users
Member credit institutions (specified in Act itself)
 Banks, Financial Institutions, NBFCs, credit card
companies, housing finance company, state financial
corporation
Insurance companies
Cellular phone service providers
Rating agency
Broker
Trading member of recognised commodity exchange
SEBI
IRDA

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 C I C Regulations, 2006
Forms of business
Privacy principles
Maximum fee and charges
Membership - Rs.15.00 lakh
Providing credit information report- Rs.500
for individuals, Rs. 5,000 for other
borrowers/ specified users

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 Principles
1. Care in collection of credit information
2. Data security and secrecy
3. Access and modification
4. Data collection limitation
5. Data use limitation
6. Data accuracy
7. Archiving and length of preservation

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 Credit Information Companies
 Credit Information Bureau (India) Ltd,
 TransUnion Intl Inc + 3 NBFCs & 10 Commercial Banks
 Equifax Credit Information Services Pvt. Ltd
 Axis Bank, UBI, PNB, Fed Bank, Ind Bank, Sundaram, Magma
 Experian Credit Information Co. of India Pvt. Ltd,
 BOI, BOB, UBI, Religare, Sundaram, Kotak
 Highmark Credit Information Services Pvt. Ltd.
 SBI, PNB, Citi, SIDBI, Edelweiss, Shriram

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 Reporting of wilful defaulters
Wilful default
Default in meeting obligations
 Despite capacity to repay
 Diversion of funds

 Siphoning of funds

 Sale of assets

Diversion
Short term loans used for long term purposes
Purchasing assets other than those for which the loan was
sanctioned
Transferring to subsidiaries group companies
Investments of funds in equity/ debt without lender’s permission
Shortfall in deployment vis-à-vis disbursal

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 Reporting of wilful defaulters
Penalties
No additional facilities
Legal process
Proactive towards change of management
Covenant- prohibiting directors from wilful defaulters

Quarterly reporting
Suit filed
Rs. 25 lakh and above

Monitoring end use

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 CIBIL

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 CIBIL

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 CIBIL TransUnion Score 2.0

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 CIBIL TransUnion Score 2.0
Score & Interpretation(i.e., for whom does this score reflect)
Index
NA or NH  Individual has no credit history & it has not been reported to us.
 Individual has no credit history but has only been enquired upon
 Individual has credit history but none that is reported in the 24 months prior to enquiry.
 Individual has a credit history but it has not been reported to us in the last 24 months.

1-5  Individual has a credit history which is less than 6 months, hence a risk Index is returned
 Higher the index, lower the risk

300-900  An individual with a credit history of more than 6 months (in the last 24 months)
 Higher the score, lower the risk

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 Securitisation And
Reconstruction of Financial
Assets and Enforcement of
Security Interest Act, 2002
( SARFAESI Act 2002)

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 SARFAESI Act, 2002
SARFAESI Act, 2002
Coverage
Securitisation and reconstruction of financial
assets
Enforcement of security interest without
court intervention
Central Registry

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 SARFAESI - Coverage
Effective since June 21, 2002
Retrospective coverage
Applicable to whole of India including J&K
Also covers notified Housing Finance Companies
Sec 31 – Act does not apply to
 Lien and pledge
 Aircrafts, shipping vessels

 Conditional sale, hire purchase, contract where no

security interest created

 Financial asset<=Rs.1 lakh

 Agricultural land

 Amount due<20% of the Principal +Interest

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 SARFAESI – Securitisation/ Reconstruction
Companies
Registration with RBI
Guidelines issued by RBI
Minimum owned fund of Rs100 crore/ 15% of
financial assets to be acquired – whichever is lower

Acquisition of financial assets

Scheme wise
Funded by investors – QIBs
Issuance of Security Receipts
Managed by trust

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 SARFAESI – Enforcement of security interest
Sequential process
 60 days notice u/s 13(2) – date of receipt is reckoned
 Notice to be properly served on all borrowers / guarantors
in whose name securities are held
 If not served as above – publish in 2 news papers
 Notice to contain details of dues & securities
 Any representation from borrower needs to be replied in
15 days comprehensively
 On completion of 60 days – steps u/s 13(4) for possession
– notice as per Rule 8

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 SARFAESI – Enforcement of security interest
Sequential process
 Served on the party – affixed on property – published in
news paper.
 If peaceful possession not obtained – file application u/s14
before Dist Magistrate / Chief Metro Magistrate
 Court may direct support of police – panchnama
 Further notice to pay in 30 days
 Valuation of property

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 SARFAESI – Enforcement of security interest
Sequential process
 Fixation of Reserve price
 Auction – e-auction
 Published in news papers & Govt. website

(webtenders.gov.in)
 10% EMD, 25% spot payment & balance in 15 days
 Any lapse in process – withdraw all notice and start
de’novo
 SARFAESI does not extend Limitation period – file
before DRT / civil court before limitation period

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 SARFAESI – Enforcement of security interest
No need for court intervention
Overriding effect over provisions of Transfer of
property Act
Notice mandatory
 60 days notice
 Details of amount payable and secured asset intended to be

enforced
 Borrower prohibited from transferring assets

Mardia Chemicals case – Supreme Court

 Sec 17(2) – unconstitutional- arbitrary, oppressive and
unreasonable
 Subsequent amendment

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 SARFAESI – Enforcement of security interest
SC Guidelines in Mardia case
 Borrower can raise objections
 Bank to apply mind while answering objections
 Response to borrower within 15 days
 Rejection of objections cannot be appealed to DRT

Can apply to DRT – deposit of 50% of the

amount due at the time of notice Sec 13(4)
possession notice.
Can seek help of District Magistrate/ Chief
Metropolitan Magistrate

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 SARFAESI – Enforcement of security interest

Recourse available to lender

Possession of secured asset
Management of secured asset
Appoint person as manager of secured assets
Require from any person who has acquired the
secured asset from the borrower to pay the
amount due to the extent of the secured asset

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 SARFAESI – Enforcement of security interest
Appropriation of proceeds
Expenses->Dues->Balance to debtor
If winding up – dues of workman have pari passu
charge
Consortium accounts – multiple secured
creditors
Creditors representing 60% earlier (3/4th )of
outstanding dues have to agree
Recent amendment- bank may purchase at
auction [13(5A)]

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 SARFAESI – Enforcement of security interest
Safeguards
Inventory of property taken into possession
Take care of property as owner of ordinary
prudence – insure if necessary
Expedite sale if subject to speedy decay
Possession notice
 affixation at outer door/ conspicuous place
 Publication in 2 leading newspapers including

one vernacular

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 SARFAESI – Enforcement of security interest
Auction
 30 days notice – publication in 2 leading
newspapers incl. vernacular
 Valuation to fix reserve price

Appeal to DRT - Compensation

 Within 45 days of measures being initiated
 50% to be deposited- DRT may reduce at the

discretion of Presiding Officer

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CERSAI ACT
Central Registry of

Securitisation Asset

Reconstruction& Security

Interest of India.
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CERSAI
It is a Section 8 Company
It is a Government Company & Public sector banks are
share holders
The object of the company is to maintained and
operate registration of Securities, Asset
reconstruction of financial assets and creation of
security interest over property as per chapter IV of
SARFAESI Act.

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CERSAI
OBJECTIVE :-
To eliminate fraudlent and dubious activities related
to taking out loans by pledging same asset as Mortgage
to various lenders at the same time.
It is a single centralised registry for all equitable
Mortgage.

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CERSAI Charge Registration Process
Form-I :-Creation and modification of charge.
From-II :-Particulars of Satisfaction of Charge.
From –III:- For Securitisation and Reconstruction of
Financial Asset.
Form-IV:- For satisfaction of Securitisation or
Reconstruction of Financial Asset.

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 Thank You
Tushar Kanti Basu
Kolkata

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