In Brief
An MSME borrower challenged enforcement proceedings initiated under the SARFAESI Act, claiming the bank violated the 2015 Framework for Revival and Rehabilitation of MSMEs by classifying the account as NPA without first identifying financial stress. The Supreme Court held that while the Framework binds banks when an MSME timely asserts its eligibility with supporting documents, banks need not pre-identify stress if unaware the borrower is an MSME. However, upon receipt of a demand notice, an MSME must immediately claim Framework benefits. Here, the petitioner failed to do so, instead filing a writ petition at an advanced enforcement stage, which amounted to a belated and suspect misuse of process. The petition was dismissed.
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