SARFAESI objections received before coercive action must be considered before sale proceedings are initiated.

Where a secured creditor receives a borrower's objections to a Section 13(2) notice before deciding to proceed under Section 13(4) of the SARFAESI Act, those objections must be considered before coercive measures are initiated. The borrower's default was admitted, but the bank could not ignore objections already in its possession merely because they were filed after the prescribed period. On the facts, proceeding to sale without addressing the objections was not justified, and the sale proceedings were set aside. The creditor was left free to recommence action under the SARFAESI Act in accordance with law after considering the objections.

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Issues: Whether the secured creditor could proceed under Section 13(4) of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 without considering the borrower's objections filed in response to the demand notice under Section 13(2), when the objections had reached the bank before the decision to proceed though after the prescribed period.

Analysis: The borrower's default was admitted and the bank's case was that the objections were filed beyond the prescribed period of sixty days. The determining factor, however, was that the bank had received the objections before it took the decision to proceed under Section 13(4). Once the objections were in the bank's possession before the impugned sale steps were initiated, a proper decision under the SARFAESI framework required their consideration. Proceeding to publication without considering those objections was therefore not justified on the facts before the Court.

Conclusion: The bank could not validly proceed with sale under Section 13(4) without considering the objections already received by it before the decision to initiate such action.

Final Conclusion: The impugned sale proceedings were set aside, while the bank was left free to recommence action under the SARFAESI Act in accordance with law after addressing the objections.

Ratio Decidendi: Where objections to action under the SARFAESI Act are received by the secured creditor before the decision to proceed under Section 13(4), the creditor must consider them before taking coercive measures.

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