The powers of a Magistrate under Section 14 of the SARFAESI Act are strictly ministerial and do not permit adjudication of third-party claims on secured assets.

ORDER :

1. The petitioner-Bank is before this Court seeking for the following reliefs:

a. Issue a Writ in nature of Certiorari quashing the impugned order dated. 29.04.2025 in Crl. Misc. No. 16/2025 passed by the Court of Senior Civil Judge and CJM, Koppal vide Annexure-B in so far as the impugned observation, in the interest of justice and equity.

b. Grant such other and further reliefs as this Hon’ble Court may deem fit and proper in the facts and circumstances of the case, in the interest of justice and equity.

2. Notice to respondents has been dispensed with in view of the matter being one between the Court and the secured creditor namely the petitioner.

3. The petitioner is a nationalized Bank and a secured creditor within the meaning of Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (for short ‘SARFAESI Act’) having advanced monies to the respondents.

4. Having complied with all the formalities under Section 13 of the SARFAESI Act, the petitioner had filed proceedings under Section 14 of the SARFAESI Act before the Court of the Senior Civil Judge and CJM, Koppal in Criminal Miscellaneous No.16/2015, seeking physical possession of the secured assets. The said Court vide order dated 29.04.2025 allowed the petitioner's application for taking physical possession and had appointed an Advocates Commissioner for the said purpose. However, in the said order, a reference has been made that “This possession delivery warrant is not binding on the 3^rd parties, if they are in possession of the property in any of the capacity.” It is being aggrieved by the said observation/direction in the aforesaid order, though the said order is in favour of the petitioner, that the petitioner is before this Court seeking the aforesaid reliefs.

5. The submission of Sri.Nandish Patil, learned counsel for the petitioner, is that:

5.1. The petitioner, being a secured creditor, the asset being a secured asset, there could be no such restriction which can be imposed.

5.2. Once the power and authority under Section 13 of the SARFAESI Act is exercised by a secured creditor in respect of a secured asset, the secured creditor can enforce the security interest in respect of the entire secured asset and no other person can be said to have any interest in such secured asset.

5.3. In this regard, he relies upon the decision in the case of Balkrishna Rama Tarle (Dead) through LRs and Another vs. Phoenix ARC Private Limited and Others, AIR 2022 SC 4756 to contend that a Magistrate under Section 14 of the SARFAESI Act acts in a ministerial capacity, he does not adjudicate any rights of the parties and as such only the actions under Section 14 of the SARFAESI Act could be performed by the Magistrate. The Magistrate could therefore not make any order under Section 14 of the SARFAESI Act subject to the rights of any third parties.

5.4. His submission is also that if at all any person is aggrieved by any order passed under Section 13 or Section 14 of the SARFAESI Act, such person or entity can file an appeal under Section 17 of the SARFAESI Act where these issues and claims would be adjudicated.

5.5. He therefore submits that this Court would be required to intercede in the matter to protect the sanctity of an order under Section 14 of the SARFAESI Act by allowing the writ petition as sought for.

6. Heard, Sri.Nandish Patil, learned counsel for the petitioner. Perused the writ petition papers.

7. The points that would arise for consideration are:

i. Whether the magistrate performs adjudicatory duties or ministerial duties under Se