AAP Tax Law
SARFAESI Act, 2002 | Chapter IV

Sections 20B and 21 of SARFAESI Act - Delegation of Powers and Central Registrar

Sections 20B and 21 of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 govern two aspects of the Central Registry: the Central Government's power to delegate specified functions to the Reserve Bank of India (RBI), and appointment of the Central Registrar and supporting officers. These provisions form part of the registration framework for securitisation, reconstruction of financial assets and security interests.

Section 20B - Delegation of powers

The Central Government may, by notification, delegate its powers and functions under this Chapter, in relation to establishment, operations and regulation of the Central Registry to the Reserve Bank, subject to such terms and conditions as may be prescribed.

Meaning: Section 20B is an enabling provision. It allows the Central Government to delegate powers relating to the establishment, operation and regulation of the Central Registry to the Reserve Bank, but only by notification and subject to the prescribed terms and conditions. It does not by itself establish that every power has been delegated; the applicable notification and rules determine the actual scope.

Legislative history: Section 20B was inserted by section 16 of Act 44 of 2016, effective 1 September 2016.

Section 21 - Central Registrar

(1) The Central Government may, by notification, appoint a person for the purpose of registration of transactions relating to securitisation, reconstruction of financial assets and security interest created over properties, to be known as the Central Registrar.

(2) The Central Government may appoint such other officers with such designations as it thinks fit for the purpose of discharging, under the superintendence and direction of the Central Registrar, such functions of the Central Registrar under this Act as he may, from time to time, authorise them to discharge.

Meaning: Sub-section (1) empowers the Central Government to appoint the Central Registrar by notification for registration of transactions covered by the Act. Sub-section (2) permits appointment of additional officers who may perform functions authorised by the Central Registrar, subject to the Registrar's superintendence and direction. Appointment and authorisation are distinct legal steps.

How Sections 20B and 21 work together

  • Regulatory delegation: Section 20B concerns delegation to the RBI of Central Registry-related governmental powers and functions under Chapter IV.
  • Registration administration: Section 21 concerns the Central Registrar and officers responsible for carrying out registration functions under the Act.
  • Notification requirements: Any particular delegation or appointment should be verified against the relevant government notification, applicable rules and current administrative arrangements.

Section 20 provides for the Central Registry. Section 20A addresses integration of other registration systems with Central Registry records. Section 22 concerns the register of transactions; Section 23 concerns filing of specified transactions. These provisions should be read together with the applicable Central Registry rules and notifications.

Official legal resources

Refer to the consolidated Act and amendments on India Code, notifications in the Gazette of India, the Department of Financial Services and official information from the Reserve Bank of India. For registration-related services and procedures, consult the official CERSAI portal.