Multiple choice

What did the Supreme Court declare as invalid in the Mardia case?

  1. Entire SARFAESI Act, 2002

  2. Creation of security interest

  3. Formation of Reconstruction Companies

  4. Condition to pay seventy-five per cent of the amounts as pre-condition while preferring appeal to the DRT
Reveal answer Fill a bubble to check yourself
D Correct answer
Explanation

As per the decision of the Court in Mardia Chemical Ltd. and Others vs. Union of India and Others [(2004) 4 SCC 311], the provision requiring pre-deposit of 75% of the demand made by the Bank or the financial institution in Section 17 of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 has been held to be onerous and oppressive, rendering the remedy illusory and nugatory and constitutionally invalid.

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