Section 2: Definitions.

Q: What does Section 2 of The Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (SARFAESI) deal with?

Section 2 SARFAESI pertains to "Definitions.". It is part of the The Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002, a legislation enacted by the Parliament of India. Section 2 of The Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (SARFAESI) defines definitions. As verified on 22 May 2026.

Q: Is Section 2 SARFAESI still in force?

Yes, Section 2 of the The Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 is currently in force across the Republic of India.

Q: What is धारा 2 SARFAESI?

धारा 2 SARFAESI is the Devanagari Hindi reference for Section 2 of the The Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002. Section 2 of The Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (SARFAESI) defines definitions. As verified on 22 May 2026.

Q: What is Dhara 2 SARFAESI?

Dhara 2 SARFAESI is the Roman Hindi reference for Section 2 of the The Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002. "Dhara" means "Section" in Hindi. Section 2 of The Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (SARFAESI) defines definitions. As verified on 22 May 2026.

Q: How to cite Section 2 of The Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002?

Cite as: "Section 2, The Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (SARFAESI)" in legal briefs. For academic writing, use the BlueBook format: The Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002, 2002, § 2 (India).

Law on Tips Editorial Board

(1) In this Act, unless the context otherwise requires,—

2 [(ba) asset reconstruction company means a company registered with Reserve Bank under section 3 for the purposes of carrying on the business of asset reconstruction or securitisation, or both;]

3 [(iva) a multi-State co-operative bank; or]

7 [(ga) company means a company as defined in clause (20) of section 2 of the Companies Act, 2013 (18 of 2013);]

8 [(ha) debt shall have the meaning assigned to it in clause (g) of section 2 of the Recovery of Debts Due to Banks and Financial Institutions Act, 1993 (51 of 1993) and includes—

9 [(ia) debt securities means debt securities listed in accordance with the regulations made by the Board under the Securities and Exchange Board of India Act,1992 (15 of 1992);]

10 [(j) default means—

12 [(va) any beneficial right, title or interest in any tangible asset given on hire or financial lease or conditional sale or under any other contract which secures the obligation to pay any unpaid portion of the purchase price of such asset or an obligation incurred or credit otherwise provided to enable the borrower to acquire such tangible asset; or

(vb) any right, title or interest on any intangible asset or licence or assignment of such intangible asset, which secures the obligation to pay any unpaid portion of the purchase price of such intangible asset or an obligation incurred or credit otherwise extended to enable the borrower to acquire such intangible asset or obtain licence of the intangible asset; or]

13 [(iiia) a debenture trustee registered with the Board and appointed for secured debt securities;

(iiib) asset reconstruction company, whether acting as such or managing a trust created for the purpose of securitisation or asset reconstruction, as the case may be;]

14 [(ma) financial lease means a lease under any lease agreement of tangible asset, other than negotiable instrument or negotiable document, for transfer of lessor's right therein to the lessee for a certain time in consideration of payment of agreed amount periodically and where the lessee becomes the owner of the such assets at the expiry of the term of lease or on payment of the agreed residual amount, as the case may be;]

15 [(na) negotiable document means a document, which embodies a right to delivery of tangible assets and satisfies the requirements for negotiability under any law for the time being in force including warehouse receipt and bill of lading;]

13 * * * * *

(zb) security agreement means an agreement, instrument or any other document or arrangement under which security interest is created in favour of the secured creditor including the creation of mortgage by deposit of title deeds with the secured creditor;

(zc) secured asset means the property on which security interest is created;

16 [(zd) secured creditor' means—

(ze) secured debt means a debt which is secured by any security interest;

18 [(zf) security interest means right, title or interest of any kind, other than those specified in section 31, upon property created in favour of any secured creditor and includes—

(zg) security receipt means a receipt or other security, issued by a 19 [asset reconstruction company]to any 20 [qualified buyer]pursuant to a scheme, evidencing the purchase oracquisition by the holder thereof, of an undivided right, title orinterest in the financial asset involved in securitisation;

(zh) sponsor means any person holding not less than ten per cent. of the paid-up equity capital of a 21 [asset reconstruction company];

(zi) State Bank of India means the State Bank of India constituted under section 3 of the State Bank of India Act, 1955 (23 of 1955);

(zj) subsidiary bank shall have the meaning assigned to it in clause (k) of section 2 of the State Bank of India (Subsidiary Banks) Act, 1959 (38 of 1959).

(2) Words and expressions used and not defined in this Act but defined in the Indian Contract Act, 1872 (9 of 1872) or the transfer of Property Act, 1882 (4 of 1882) or the Companies Act, 1956 (1 of 1956) or the Securities and Exchange Board of India Act 1992 (15 of 1992) shall have the same meanings respectively assigned to them in those Acts.1. Subs. by s. 3, ibid., for securitisation company or reconstruction company (w.e.f. 1-9-2016). 2. Ins. by s. 4, ibid. (w.e.f. 1-9-2016). 3. Ins. by Act 1 of 2013, s. 2 (w.e.f. 15-1-2013). 4.Subs. by Act 13 of 2021, s. 162, for any person who (w.e.f. 1-4-2021). 5. Subs. by s. 162, ibid., for and includes a person who (w.e.f. 1-4-2021). 6. Subs. by Act 44 of 2016, s. 3, for securitisation company or reconstruction company (w.e.f. 1-9-2016). 7. Ins. by s. 4, ibid. (w.e.f. 1-9-2016). 8. Subs. by s. 4, ibid., for clause (ha) (w.e.f. 1-9-2016). 9. Subs. by s. 4, ibid., for clause (j) (w.e.f. 1-9-2016). 10. Ins. by Act 44 of 2016, s. 4 (w.e.f. 1-9-2016). 11. Ins. by Act 44 of 2016, s. 4 (w.e.f. 1-9-2016). 12. Subs. by Act 30 of 2004, s. 2, for certain words (w.e.f. 11-11-2004). 13. Subs. by Act 44 of 2016, s. 3, for 'securitisation company or reconstruction company (w.e.f. 1-9-2016). 14. Subs. by s. 3, ibid., for qualified institutional buyer (w.e.f. 1-9-2016). 15. Omitted by Act 44 of 2016, s. 4 (w.e.f. 1-9-2016). 16. Subs. by s. 3,ibid.,for securitisation company or reconstruction company (w.e.f. 1-9-2016). 17.Subs. by Act 13 of 2021, s. 162, for the Board appointed by any company (w.e.f. 1-4-2021). 18. Subs. by s. 3, ibid., for qualified institutional buyers (w.e.f. 1-9-2016). 19. Subs. by s. 4, ibid., for clause (zd) (w.e.f. 1-9-2016). 20. Subs. by s. 4, ibid., for clause (zf) (w.e.f. 1-9-2016). 21. Subs. by Act 44 of 2016, s. 3, for securitisation company or reconstruction company (w.e.f. 1-9-2016). 22. Subs. by s. 3,ibid.,for qualified institutional buyer (w.e.f. 1-9-2016).