1. The petitioner by this petition has challenged the order dated 20.01.2010 passed by the Chief Metropolitan Magistrate in Criminal Misc. Application No.13/10, whereby he has issued notice upon the opponent therein against whom the order under Section 14 of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (hereinafter referred to as “Securitisation Act”) has been prayed.

2. As larger question had arisen in the present petition as to whether the Magistrate could exercise the power of issuing notice to the borrower or the party against whom the application is made under Section 14 of the Securitisation Act or not, the notice was ordered to be issued to the Government Pleader on behalf of the State Government as well as to the learned Assistant Solicitor General on behalf of the Central Government. Thereafter, the learned Government Pleader had called for the remarks of the Executive Magistrate regarding the exercise of the power under Section 14 of the Securitisation Act and he has placed on record the comments received by him together with the suggestion.

3. I have heard the learned Assistant Solicitor General Mr. Champaneri. After the comments received on behalf of the State Government, Mr. Shah, learned counsel for the petitioner is also heard.

4. At this stage, it deserves to be recorded that this Court had an occasion to consider the question, of course at the admission stage, as to whether the learned Metropolitan Magistrate was required to issue the notice under Section 14 of the Securitisation Act to the borrower or that he had only to issue the orders under Section 14 of the Act without verification of the condition precedent for exercise of the powers or not, in the case of Al-fare Textile and Engineering Pvt. Ltd. & Anr. Vs. Bombay Mercantile Coop Bank Ltd. in SCA No.11674/08 and it was observed by the Court, inter alia as under:

8. The larger question which may arise for consideration is mode and manner of the exercise of the power by the learned Magistrate under Section 14 of the Securitisation Act for providing police assistance to the financial institution. As per the scheme of the act read with the provisions of Section 14 of the Securitisation Act, it prima facie appears that it is required for the learned Magistrate to verify the record to the extent that the conditions precedent for exercise of the power by the bank under Section 13 (4) of the Securitisation Act are satisfied and thereafter, there was resistance to take possession, and hence, the application was made before the learned Magistrate by the financial institution/bank.

9. As per the scheme of the Act, following aspects are required to be verified/examined by the learned Magistrate, while exercising power under Section 14 of the Securitisation Act.

A) The transaction of the mortgaged property.

B) The declaration of the Account as N.P.A.

C) The issuance of the notice under Section 13(2) of the Securitisation Act and the receipt thereof by the borrower, or the person against whom order is to be passed.

D) The reply of the borrower or the guarantor as the case may be, or the person against whom the order is to be passed.

E) The decision of the bank, if any, with the proof for communication of the same to the person concerned.

F) The declaration that after the communication of the decision under Section 13 (3A) of the Securitisation Act, the payment is not fully made by the borrower and such would include the details of the payment, if any, made by the borrower after notice under Section 13(2) of the Securitisation Act, or after communication of the decision under Section 13 (3A) of the Securitisation Act, as the case may be.

G) The statement mentioning the net amount outstanding, as recoverable by the bank.

H) The details of the litigation if any, for recovery of the amount, may be before the Civil Court, or may be before the DRT or before the Board of Nominees or before any forum known t