Bank Auction Glossary
Plain-English definitions of every term you need to understand bank auction property in India. 50 terms across 12 categories.
Legal
SARFAESI Act
Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002.
DRT (Debt Recovery Tribunal)
Statutory tribunal for recovering debts owed to banks and financial institutions where the dispute exceeds INR 20 lakh.
DRAT (Debt Recovery Appellate Tribunal)
Appellate forum that hears appeals against DRT orders.
NCLT (National Company Law Tribunal)
Statutory tribunal that handles corporate insolvency under the Insolvency and Bankruptcy Code, 2016.
IBC (Insolvency and Bankruptcy Code)
The 2016 Code that consolidates and governs corporate insolvency in India.
Section 14 (SARFAESI)
Provision empowering the District Magistrate to assist the secured creditor in taking physical possession.
Section 17 (SARFAESI)
Provision giving borrowers the right to challenge SARFAESI actions before the DRT within 45 days.
13(2) Notice (SARFAESI)
Statutory notice giving a defaulting borrower 60 days to repay before SARFAESI action.
13(4) Notice (SARFAESI)
Statutory notice taking symbolic possession of the secured asset after the 13(2) window expires.
Section 13(8) (SARFAESI)
Provision under which the auction buyer steps into the secured creditor’s rights.
Banking
NPA (Non-Performing Asset)
Loan account where principal or interest payment is overdue for 90 days or more.
SMA (Special Mention Account)
RBI classification for accounts showing early signs of stress, before NPA classification.
Substandard Asset
NPA that has been non-performing for less than 12 months.
Doubtful Asset
NPA classified as substandard for 12 months or more.
Loss Asset
NPA where loss has been identified by the bank, auditor, or RBI inspection but not yet written off.
CIBIL Check
Credit history pull that some banks perform on bidders for high-value auction lots.
Auction Process
EMD (Earnest Money Deposit)
Refundable security deposit paid by every bidder before participating in a bank auction.
Reserve Price
Minimum price below which the property will not be sold in the auction.
Sale Notice
Public notice published 30 days before an auction announcing the sale.
Sale Certificate
Statutory document issued to the auction winner confirming the transfer of ownership.
E-Auction Platform
Online portal where bank auctions are conducted (MSTC, AuctionTiger, e-Procurement Technologies, etc.).
Valuation Report
Document by a registered valuer establishing the fair market value of the property.
Bank Guarantee
Lender-issued guarantee that can substitute for cash EMD on high-value auction lots.
Bidder Registration
Mandatory pre-auction step to enroll on the e-auction portal and obtain bidding credentials.
Inspection Window
The period before an auction during which buyers can physically inspect the property.
Forfeiture of EMD
Loss of the Earnest Money Deposit when the winning bidder fails to complete payment.
Spot Sale / Private Treaty
Direct negotiated sale by the bank after two failed public auctions.
Possession
Symbolic Possession
Legal possession on paper without physical control of the property.
Physical Possession
Actual control of the property — vacant, with keys handed to the seller.
Title
Encumbrance Certificate (EC)
Document from the sub-registrar showing all registered transactions on a property over a specified period.
Title Deed
Legal document proving ownership of immovable property.
Mortgage Deed
Document creating a mortgage in favor of a lender as security for a loan.
Database
Client PK / Bank PK
Internal numeric identifier (primary key) for a bank or financial institution in the listings database.
Portals
IBAPI (Indian Banks Auctions Mortgaged Properties Information)
Government-backed central portal listing bank auction properties across India.
BAANKNET
Government-backed e-auction portal for Indian banks selling NPAs.
Insolvency
RP (Resolution Professional)
Court-appointed professional who runs the corporate insolvency resolution process under IBC.
Liquidator
Court-appointed professional who sells corporate debtor assets when CIRP fails.
Section 53 Waterfall (IBC)
Priority order for distributing liquidation proceeds under IBC.
ARC (Asset Reconstruction Company)
RBI-licensed company that buys NPAs from banks and pursues recovery, including through SARFAESI auctions.
Security Receipts (SR)
Instruments issued by ARCs to qualified institutional buyers when acquiring NPAs.
Costs
Stamp Duty
State tax payable on the sale certificate to register the transfer of ownership.
TDS on Property Sale (Section 194-IA)
1% TDS the buyer must deduct when buying property worth INR 50 lakh or more.
Capital Gains Tax (on resale)
Tax payable when reselling an auction property at a profit.
Post-sale
Mutation
Process of updating land/property records to reflect the new owner after a sale.
Financing
LTV (Loan-to-Value) Ratio
Percentage of property value a lender will fund.
Home Loan for Auction Property
Special-purpose loan product offered by select banks to fund auction property purchase.
Balance Transfer (Auction Loan)
Refinancing an auction-property loan to a different lender at better terms after a seasoning period.
Vehicle
RC Transfer (Vehicle Auction)
Process of transferring the Registration Certificate to the auction buyer’s name at the RTO.
Hypothecation (Vehicle Loan)
Lien recorded on a vehicle’s RC in favor of the financing bank.
Bank NOC (Vehicle Auction)
No Objection Certificate from the auctioning bank required for RC transfer to the new buyer.
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