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Original Article | Volume 2 Issue 2 (ACR, 2025) | Pages 965 - 972
SARFAESI Act in Practice: Legal Efficacy, Judicial Trends, and Borrower Safeguards
1
Professor of Practice, School of Law, UPES, Dehradun.
Under a Creative Commons license
Open Access
Abstract

The Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest (SARFAESI) Act, 2002, was enacted to empower banks and financial institutions to recover non-performing assets (NPAs) efficiently without the intervention of courts. While the Act significantly strengthened creditor rights, it also raised concerns regarding the protection of borrower interests and the balance of power between lenders and debtors. This paper explores the practical efficacy of the SARFAESI Act in achieving its legislative intent, examines the evolving judicial interpretations and trends in its application, and analyzes the safeguards available to borrowers against arbitrary or excessive creditor actions. Through a comprehensive review of case law, enforcement data, and comparative legal insights, the study evaluates whether the Act continues to serve its dual objectives of financial discipline and fairness in debt recovery.

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