Real Estate Update: When Can The Borrower's Right Of Redemption Be Exercised

The Supreme Court of India ("Supreme Court") recently clarified its stance on the borrower's right of redemption in Sanjay Sharma v. Kotak Mahindra Bank Ltd. The Supreme Court ruled that borrower's right of redemption can only be exercised until the notice for the sale of the mortgaged property is published under Rule 9(1) of the Security Interest (Enforcement) Rules, 2002. Prior to the 2016 amendment to the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 ("SARFAESI Act"), borrowers retained the right to redeem the property until its actual sale or transfer. However, post-amendment, this right is curtailed at the publication of the sale notice.