Auction purchasers should have good knowledge of various rules governing auctions of assets by Banks, Financial Institutions, State Financial corporations and by the Official Liquidators. A little knowledge of Rules and procedures will help you avoid pit falls and getting stuck in bad auction circumstances where your money gets stuck in endless litigations. You must particularly have good knowledge of the following :
- Chapter V of the RDB Act.
- 2nd Schedule of the Income Tax Act.
- 3rd Schedule of the Income Tax Act.
- The Income Tax (Certificate of Proceedings) Rules.
Even though nothing has been mentioned in the SRFAESI Act, by and large the procedure followed by the Banks is the same as discussed in the above paras.
In additions there are 10s and 100s of judgments by various courts covering many aspects of auctions by public bodies and rights of auction purchasers, the secured creditors as well as that of the asset owners. If you are a die hard auction purchasers do not fail to have at least a brief knowledge about the legal positions.