Amendment bill passed; Government can intervene in foreclosure proceedings; heir will get land even land owner dies

THIRUVANANTHAPURAM: The Legislative Assembly has unanimously passed the amendment bill empowering the government to provide relief and prevent the eviction of common people on account of the confiscation process in case of three arrears. A provision was also included for the land to be returned to the heirs if the owner of the confiscated land died. Minister K Rajan submitted the bill for the approval of the House by including this amendment brought by the Leader of Opposition VD Satheesan. The bill will take effect once the governor signs it.

This is the first time in the country that a state government has come to intervene in the foreclosure proceedings. The bill was re-introduced today after consideration by the subject committee. The government had intervened and stopped confiscation proceedings amid public outrage against the confiscations, but the High Court had accepted the banks' contention that the government had no authority to do so. It was in this situation that the state brought the amendment act.

Once the law comes into effect, the government will be able to provide a moratorium on foreclosure proceedings. The special feature of the law is that the land can be held without sale for a period of five years, within which the land can be returned to the owner or the heirs if the loan arrears are paid. The collector will be authorized to release the necessary land alone for confiscation if the value of the land is more than the loan amount.

Can be suggested to pay the dues in installments

There is a provision in the bill to notify the collector before completing the process and authorize the process if the property is in two districts. It is proposed to lower the interest rate on the loan from 12% to 9% and if the interest rate is lower than that in the loan agreement, only that rate should be charged. The government will also be empowered to direct payment of arrears in instalments. However, the law cannot interfere with confiscations under the SARFAESI Act.