Central Registry for Loans Established

Setting up of Central Electronic Registry under the Securitisation and Reconstruction
of Financial Assets and Enforcement of Security Interest Act 2002
Pursuant to the announcement made by the Finance Minister in the budget speech for
2011?12, Government of India, Ministry of Finance notified the establishment of the
Central Registry. The objective of setting up of Central Registry is to prevent frauds in
loan cases involving multiple lending from different banks on the same immovable
property. This Registry has become operational on March 31, 2011. The Central Registry
of Securitisation Asset Reconstruction and Security Interest of India (CERSAI), a
Government Company licensed under section 25 of the Companies Act 1956 has been
incorporated for the purpose of operating and maintaining the Central Registry under
the provisions of the Securitisation and Reconstruction of Financial Assets and
Enforcement of Security Interest Act, 2002 (SARFAESI Act).
It may be noted that initially transactions relating to securitization and reconstruction
of financial assets and those relating to mortgage by deposit of title deeds to secure any
loan or advances granted by banks and financial institutions, as defined under the
SARFAESI Act, are to be registered in the Central Registry. The records maintained by
the Central Registry will be available for search by any lender or any other person
desirous of dealing with the property. Availability of such records would prevent frauds
involving multiple lending against the security of same property as well as fraudulent
sale of property without disclosing the security interest over such property. It may be
noted that under the provisions of Section 23 of the SARFAESI Act, particulars of any
charge creating security interest over property is required to be filed with the Registry
within 30 days from the date of creation.





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