LexBALKRISHNA RAMA TARLE DEAD THR LRS & ANR versus PHOENIX ARC PRIVATE LIMITED & ORS
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A B C D E F G H 437 BALKRISHNA RAMA TARLE DEAD THR LRS & ANR. v. PHOENIX ARC PRIVATE LIMITED & ORS. (Special Leave Petition No. 16013 of 2022) SEPTEMBER 26, 2022 [M. R. SHAH AND KRISHNA MURARI, JJ.] Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002: s. 14 – Chief Metropolitan Magistrate or District Magistrate to assist secured creditor in taking possession of secured asset – Scope, ambit, and jurisdiction of the District Magistrate/designated authority u/s. 14 – On facts, application u/s 14 by the secured creditor seeking assistance of designated authority for taking physical possession of the secured assets – Petitioner claiming to be a tenant in respect of the part of the secured assets sought to intervene in the said proceedings – Thereafter, the designated authority declined to assist the secured creditor in taking possession of the secured assets holding that after the secured creditor terminates the tenancy rights of the third person by following due procedure of law the further orders regarding possession of the mortgaged property would be decided – Aggreived, secured creditor filed writ petition – High Court set aside the order passed by the designated authority holding that the order was beyond the scope and ambit of the powers to be exercised u/s 14, and directed the designated authority to dispose of the application in accordance with the provisions of s.14 – On appeal, held: Power exercisable by the Chief Metropolitan Magistrate or District Magistrate u/s. 14 are ministerial step and does not involve any adjudicatory process qua points raised by the borrowers against the secured creditor taking possession of the secured creditor – Once all the requirements u/s.14 are complied with by the secured creditor, the duty is cast upon the designated authority to assist the secured creditor in obtaining the possession as well as the documents related to the secured assets – At that stage, designated authority is not required to adjudicate the dispute between the borrower and secured creditor and/or between any other third party and aggrieved party to be relegated to raise objections in the proceedings before DRT u/s. 17 – On facts, the High Court did not commit any error in [2022] 13 S.C.R. 437 437 A B C D E F G H 438 SUPREME COURT REPORTS [2022] 13 S.C.R. setting aside the order passed by the designated authority, and directing the designated authority to dispose of the application in accordance with the provisions of s.14 – Thus, the order passed by the High Court, upheld. Harshad Govardhan Sondagar v. International Assets Reconstruction Company Limited and Ors.; (2014) 6 SCC 1 : [2014] 11 SCR 605; Vishal N. Kalsaria v. Bank of India and Ors.; (2016) 3 SCC 762 : [2016] 1 SCR 419 – held inapplicable. NKGSB Cooperative Bank Limited v. Subir Chakravarty & Ors. Civil Appeal No. 1637/2022 decided on 25.02.2022; M/s R.D. Jain and Co. v. Capital First Ltd. & Ors. Civil Appeal No. 175/2022 decided on 27.07.2022 – referred to. Case Law Reference [2014] 11 SCR 605 held inapplicable Para 6 [2016] 1 SCR 419 held inapplicable Para 7 EXTRA ORDINARY APPELLATE JURISDICTION: Special Leave Petition No. 16013 of 2022. From the Judgment and Order dated 03.08.2022 of the High Court of Judicature at Bombay in Writ Petition No. 9749 of 2021. Vinay Navare, Sr. Adv., Shashibhushan P. Adgaonkar, Omkar Jayant Deshpande, Advs. for the Petitioners. The Order of the Court was passed by M. R. SHAH, J. 1. Feeling aggrieved and dissatisfied with the impugned judgment and order dated 03.08.2022 passed by the High Court of Judicature at Bombay in Writ Petition No. 9749/2021, by which the Division Bench of the High Court has allowed the said writ petition preferred by the respondent No. 1 herein – secured creditor and has set aside order dated 27.08.2021 passed by the designated authority under Section 14 of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (hereinafter referred to as the SARFAESI Act, 2002) and directed the designated authority under A B C D E F G H 439 Section 14 of the SARFAESI Act to dispose of the application under Section 14 of the SARFAESI Act afresh, legal heirs of original respondent No. 2 claiming to be the tenant of the mortgaged property, have preferred the present Special Leave Petition. 2. The Religare Finvest Ltd. (hereinafter referred to as the Religare) sanctioned a loan of Rs. 6 crores in favour of the borro
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