J U D G M E N T

1. The petitioners in the instant writ petition seek to challenge the order dated 02.12.2022 passed by the learned Chief Metropolitan Magistrate (CMM), South East District, Saket District Court in MCA No.521/2021 under Section 14 of the Securitisation and - 3 –

Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (hereinafter as ‘SARFAESI Act’).

2. Learned counsel appearing on behalf of the petitioners submits that the impugned order is an abuse of the process of law, at the instance of respondent which is a Non-Banking Financial Corporation (hereinafter as ‘NBFC’) engaged in providing financial assistance to the public at large. According to him, there was already a stay operating with respect to the mortgaged property i.e., B-47, Greater Kailash Part-1, New Delhi-110048 in Civil Suit (OS) 280/2021. He also submits that the said stay was continued from time to time and was very much in existence on the date of passing of the order on 02.12.2022. He further submits that the impugned order is passed on an application for extension of the earlier order dated 06.12.2021, which is in direct contravention of the mandate of Section 14 of the SARFAESI Act.

3. Learned counsel for the petitioners submits that, in all fairness, the respondent, while filing an application before the concerned CMM, ought to have disclosed the correct facts as were obtained on the date of filing of the application alongwith the requisite affidavit as required under first proviso of sub-Section (1) of Section 14 of the SARFAESI Act. He also submits that the timeline prescribed under second and third proviso of Section 14(1) of the SARFAESI Act is also breached in the instant case.

4. According to him, if an application is filed before the Magistrate under Section 14(1) of the SARFAESI Act, the Magistrate has to record his satisfaction on the contents of the affidavit and has to - 4 –

pass an appropriate order for the purpose of taking possession of the secured assets within a period of 30 days from the date of the application. He, therefore, states that in any case, if no order is passed by the learned CMM within a period of 30 days for the reasons beyond his control, he may pass the order, after recording reasons in writing, within such further period but the same should not exceed beyond 60 days in aggregate.

5. Learned counsel for the petitioners also submits that in the instant case, the respondent earlier filed an application before learned CMM on 01.12.2021 which was disposed of in terms of order dated 06.12.2021. Once that application was disposed of, the concerned CMM had become functus officio. He could not have passed further orders on the said application for extension in the absence of there being specific affidavit with respect to the disclosure required under first proviso of Section 14(1) of the SARFAESI Act. He further states that since the application filed by the respondent was disposed of by the learned CMM on 06.12.2021, therefore, the disposed of application cannot be revived on the pretext of extension of the order.

6. According to him, the respondent should have filed second application and if such an application is filed, the disclosure as required under the first proviso to Section 14(1) of the SARFAESI Act, was supposed to be made by the respondent. The same would have taken care of the interest of the borrower ensuring that no prejudice is caused to the borrower, as at the stage of Section 14 of the SARFAESI Act, the borrower is not supposed to be heard by the learned CMM. Since the proceedings under Section 14 of the - 5 –

SARFAESI Act are carried out at the instance of the respondent and in the absence of the borrower, the requirement under the law has to be followed in its letter and spirit.

7. Learned counsel for the petitioners also submits that in the instant case, the borrower, while challenging the action of the respondent, filed an application under Section 17 of the SARFAESI Act before