JUDGEMENT

N. Kotiswar Singh, CJ.

1. The writ petition involves a seminal question of law as to whether this Court in exercise of the writ jurisdiction under Article 226 of the Constitution of India can intervene in a proceeding challenging an order passed by the Chief Judicial Magistrate under section 14 of the Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest Act 2002, (for short SARFAESI Act).

Background

2. An order was passed on 30.05.2023 by the Chief Judicial Magistrate, Budgam under section 14 of the SARFAESI Act at the instance of the respondent J&K Bank, by which the Sub Divisional Magistrate, Chandoora, was authorised to take possession of the mortgaged properties of the petitioner firm.

3. The legal contestation embarked upon by the petitioner is primarily based on the ground that mandatory provisions under section 13(3-A) read with Section 14 of the SARFAESI Act had not been complied with by the respondent Bank at the time of filing the application by the Bank seeking assistance of the Bank under section 14 of the Act, on the basis of which the Chief Judicial Magistrate (CJM) passed the impugned order under section 14.

It has been submitted that the order passed by the CJM suffers from the fatal defect of non-compliance with the mandatory statutory provision of the Act and as such, the order of the CJM cannot be sustained in law, deserving interference from this Court.

4. Considering that the issue raised is primarily legal in nature, it may not be necessary to refer in detail to the background facts, except for the bare minimum as may be relevant.

It would perhaps suffice for our purpose to mention that the petitioner firm had obtained a cash credit facility with the limit of Rs. 6.00 crores from the respondent Bank for running its business at Lassipora in connection with which an amount of Rs. 59,821,376.66 became outstanding against the petitioner as on 13.12.2022. The said loan amount was secured by the petitioner by mortgaging lands, possession for which by the Respondent Bank, the CJM passed the aforesaid impugned order under section 14 of the SARFAESI Act at the instance of the respondent Bank, on failure of the petitioner to discharge the liability.

Contentions of the petitioner

5. The main contention of the petitioner before us is that the respondent Bank could not have approached the CJM seeking an order for possession under section 14 of the SARFAESI Act without following the mandatory requirements stipulated under section 13(3-A) and Section 14 of the SARFAESI Act.

6. It is the case of the petitioner that in the present case, while the respondent Bank submitted an application before the CJM, Budgam, the said application was not accompanied by an affidavit containing the correct facts and information as required under sub-section (1) of Section 14 of the Act, rather, the affidavit contained false information.

7. It has been submitted on behalf of the petitioner that in the said affidavit it was required to be mentioned that the borrower had committed default in payment of the financial assistance because of which the account of the borrower has been classified as a non-performing asset. [vide clause (v) of the first proviso to Section 14 ].

8. It was also required to be mentioned in the affidavit that a period of 60 days' notice as required under sub-section (2) of Section 13 of the Act, demanding payment of the defaulted financial assistance was served on the borrower. [vide clause (vi) of the first proviso to Section 14 ].

Further, the affidavit was required to contain the