The Deputy Commissioner must promptly conclude proceedings under Section 14 of the SARFAESI Act, reflecting the statutory obligation to act without delay in recovery cases.

ORDER :

1. The present writ petition has been filed for issuance of direction upon the respondent no. 2 - the Deputy Commissioner, Hazaribag to forthwith dispose of the application dated 12.09.2024 preferred by the petitioner under Section 14 of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (hereinafter referred to as “the SARFAESI Act 2002”) which was registered as SARFAESI Case No. 180 of 2024 (Acknowledgement No. RCMSON24084909).

2. Learned counsel for the petitioner submits that the petitioner is a company incorporated under the Companies Act and is one of the leading non-banking financial institutions registered with RBI. It has been engaged in the business of financing for purchasing of vehicles/houses by providing financial assistance to different companies, body corporates and private individuals.

3. It is further submitted that the respondent no. 3 is the borrower and the respondent nos. 4 to 7 are co-borrowers, who had applied for loan for the purpose of enhancement of their business to the tune of Rs.50,00,000/- & Rs.1,00,000/- from the petitioner- company. The said loan was sanctioned to the said applicants on their acceptance of the terms and conditions mentioned in the sanction letter dated 30.03.2022. The applicants (the private respondents), however, defaulted in repayment of loan and accordingly, the concerned accounts were classified as Non- Performing Asset (NPA) on 03.02.2024. Thereafter, the petitioner served a demand notice under Section 13 (2) of the SARFAESI Act, 2002 dated 12.02.2024 through registered post to the said private respondents and the same was also published in the newspapers as per the provisions of law.

4. The private respondents having not responded to the notice served to them under Section 13 (2) of the SARFAESI Act, 2002, the petitioner served notice under Section 13 (4) of the said Act read with rule 8(1) of the Security Interest (Enforcement) Rules, 2002 to the private respondents through registered post as well as published the same in the daily newspapers on 23.06.2024. Despite that, the private respondents did not co-operate the petitioner in taking possession of the property in question (i.e., the land appertaining to Khata No. 04, Plot No. 28, Thana No.177, Mouza- Chano, P.S.-Hazaribagh, District-Ramgarh, measuring an area of 30 decimals), which was pledged with the petitioner as equitable mortgage at the time of sanction of the loan. Under the said circumstance, the petitioner filed an application before the respondent no. 2 under Section 14 of the SARFAESI Act, 2002 on 12.09.2024, which was registered as SARFAESI Case No. 180 of 2024 (Acknowledgement No. RCMSON24084909). The grievance of the petitioner is that the respondent no. 2, instead of disposing of the said application expeditiously, has still kept the same pending without passing any effective order, which has compelled it to prefer the present writ petition.

5. Learned counsel for the petitioner places reliance on a judgment rendered by the Hon’ble Supreme Court in the case ofBalkrishna Rama Tarle (Dead) through legal Representatives and another Vs. Phoenix Arc Private Limited & Ors. (2023) 1 SCC 662 , paragraph-16 of which reads as under:

“16. The statutory obligation enjoined upon the CMM/DM is to immediately move into action after receipt of a written application under Section 14 (1) of the SARFAESI Act from the secured creditor for that purpose. As soon as such an application is received, the CMM/DM is expected to pass an order after verification of compliance of all formalities by the secured creditor referred to in the proviso in Section 14 (1) of the SARFAESI Act and after being satisfied in that regard