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A.M.KHANWILKAR, DINESH MAHESHWARI
Authorised Officer, Indian Bank – Appellant
Versus
D. Visalakshi – Respondent
Key Points: - The judgment discusses whether CJM in non-metropolitan areas is competent to process Section 14 applications to take possession of secured assets. (!) (!) (!) - It analyzes the interchangeability and inclusive construction of CMM and CJM, and the distinction between metropolitan vs non-metropolitan areas for Section 14 powers. (!) (!) (!) - It considers the relationship between SARFAESI Act provisions (Sections 14, 37) and other laws including Cr.P.C., and whether Cr.P.C. can be applied in conjunction with SARFAESI. (!) (!) (!) - It references purposive/teleological interpretation to include CJM within Section 14 in non-metropolitan areas. (!) (!) (!) - It notes that the inquiry under Section 14 is administrative or executive, not adjudicatory, and that the borrower has remedies under Section 17 and judicial review. (!) (!) (!) - It confirms the official position that, in non-metropolitan areas, CJM can be equated with CMM for purposes of Section 14. (!) (!) - It discusses the doctrine of prospective overruling in the context of conflicting High Court decisions. (!)
JUDGMENT :
A.M. KHANWILKAR, J.
1. Delay condoned. Leave granted in Special Leave Petitions.
2. The seminal question involved in these appeals is: whether the Chief Judicial Magistrate (for short “CJM”) is competent to process the request of the secured creditor to take possession of the secured asset under Section 14 of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (for short “2002 Act”). There are conflicting views of different High Courts on this question. The High Courts of Bombay, Calcutta, Madras, Madhya Pradesh and Uttarakhand have interpreted the said provision to mean that only the Chief Metropolitan Magistrate (for short “CMM”) in metropolitan areas and the District Magistrate (for short “DM”) in non-metropolitan areas are competent to deal with such request. On the other hand, the High Courts of Kerala, Karnataka, Allahabad and Andhra Pradesh have taken a contrary view of the same provision, to mean that it does not debar or preclude the CJM in the non-metropolitan areas to exercise power under Section 14 of the 2002 Act.
3. The earliest decision is of the Division Bench of the High Court of Kerala at Ernakulam in Muh
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