https://www.taxtmi.com/caselaws?id=197575 A secured creditor may invoke section 13(2) of the SARFAESI Act only after default and valid classification of the account as a non-performing asset, and such classification must comply with Reserve Bank of India asset-classification guidelines rather than be made mechanically. The Court found that the bank had followed the required decision-making process, and the record showed substantial overdue liabilities, prolonged non-payment, and no income from the accounts during the relevant period. The borrowers' assurances of future payment did not undo the existing default or the threshold already crossed for NPA classification. No arbitrariness was found, so the NPA classification and the section 13(2) notice were upheld. en-us Tue, 06 Jul 2010 00:00:00 +0530 Wed, 10 Jan 2018 12:02:51 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=197575 A secured creditor may invoke section 13(2) of the SARFAESI Act only after default and valid classification of the account as a non-performing asset, and such classification must comply with Reserve Bank of India asset-classification guidelines rather than be made mechanically. The Court found that the bank had followed the required decision-making process, and the record showed substantial overdue liabilities, prolonged non-payment, and no income from the accounts during the relevant period. The borrowers' assurances of future payment did not undo the existing default or the threshold already crossed for NPA classification. No arbitrariness was found, so the NPA classification and the section 13(2) notice were upheld. Case-Laws Companies Law Tue, 06 Jul 2010 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=197575