The court clarified that the jurisdiction of the relevant Authority under Section 14 of the SARFAESI Act is limited to assisting a secured creditor in recovering possession of secured assets from a defaulting borrower and does not provide for the borrower to file objections or reasons to resist possession.

JUDGMENT :

(A.S. Doctor, J.)

1. The present Writ Petition impugns an order dated 26th March 2021 (“impugned order”) passed by the Additional District Magistrate, Nashik in Securitization Case No.285/2017 (“the said Application”) filed by Petitioners under Section 14 of Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (“the SARFAESI Act”). By the said order the Additional District Magistrate, Nashik has disposed the said Application without taking possession of the secured assets mortgaged by Respondent No. 2 in favour of Petitioners despite due compliance by Petitioners with the provisions of Section 14 of the SARFAESI Act.

2. The facts, briefly stated are, that Petitioners are authorized officers of four financial institutions who had advanced loans aggregating Rs.141.38 crores (approximately) to Respondent No.2 at various intervals. The said loans had been secured, inter-alia, by a mortgage of the following immovable properties (“secured assets”) created by Respondent No. 2 in favour of the Petitioners, viz.

“(a) All those pieces and parcel of Leasehold Land bearing Survey No.4/1, 4/2, 5/1, 5/2, 5/3/4, 6/2/1 admeasuring 80,400 sq. meters, situated at Village Vilholi, Taluka and District Nashik, and within the limits of Zilla Parishad, Nashik and within the limits of Vilholi Grampanchayat together with all buildings, sheds and structures constructed thereon and all plant and machinery attached to the earth or permanently fastened to anything attached to the earth. Fixtures and fitting erected/installed thereon and every part thereof and all movable assets.

(b) All those pieces and parcel of the property bearing Plot No.F-29A admeasuring area 1628 sq. mtrs. And Plot No. F-29B admeasuring area 2489 sq.mtrs. in the Nashik Industrial Area at Village Satpur, within the limits of Nashik, Municipal Corporation, taluka and District Nashik together with all buildings shed and structures constructed thereon and all plant and machinery attached to the earth or permanently fastened to anything attached to the earth. Fixtures and fittings erected / installed thereon and every part thereof and all movable assets.”

It is not in dispute that Respondent No. 2 thereafter committed defaults in repayment of the amounts due to Petitioners which led to Petitioners classifying the accounts of Respondent No.2 as Non-Performing Assets (“NPA”). Petitioners thereafter, in their capacity as secured creditors as defined in Section 2 (zd) of the SARFAESI Act, issued a demand notice to Respondent No.2 under Section 13(2) of the said Act. Despite due receipt of the said demand notice Respondent No. 2 failed and neglected to discharge in full it’s liabilities to Petitioners within the statutory period of 60 days as provided for in Section 13(2) of the SARFAESI Act, thus entitling Petitioners to take possession of secured assets under Section 13(4) of the said Act.

3. It appears Respondent No.2 thereafter obstructed Petitioners from taking possession of the secured assets. On 8th February 2021 Petitioners thus filed an Application invoking the jurisdiction of the Additional District Magistrate, Nashik to assist Petitioners in taking possession of the said secured assets in which the Petitioners sought the following reliefs, viz.

“a. To exercise powers under section 14 of the Act and take over the possession of the secured asset as described hereinabove for the recovery of Rs.286,63,61,990.47/-(In Words Rupees Two Hundred And Eighty Six Crore Sixty Three Lakhs Sixty One Thousand Nine Hundred And Ninety & paisa forty seven only)

b. To handover the possession of the secured asset with documents thereof to Applicants herein.

c. To direct the concerned police authorities to assist/give full protection to the officers appointed by this Hon’ble Court for execution of the order; and if the premises are found locked, to break open the lock of the said premises.

d. Applicants are ready to bear the cost of the proposed