The court established the necessity for District Magistrates to act promptly on applications under Section 14 of the SARFAESI Act, affirming their ministerial role and ensuring timeliness to protect creditor rights.

S HEEL NAGU, C.J. ( Oral)

1. The petitioner-Bank is before this Court invoking writ as well as supervisory jurisdiction under Article 226/227 Constitution of India, being aggrieved by in-action on the part of District Magistrate, Panchkula to decide the application submitted by petitioner u/s 14 of Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (in short the SARFAESI Act) which is pending since 09.04.2025.

2. It is stated in the application that the respondent-borrower(s) availed a loan facility of Rs.3.71 crores from the applicant-Bank, and upon default in repayment, the account was classified as Non-Performing Asset (NPA), whereafter demand notice dated 19.04.2023 under Section 13(2) of the SARFAESI Act was duly served upon the borrower(s), calling upon them to discharge their liability within 60 days. The borrower(s) failed to comply with the said demand notice, and accordingly, the secured creditor proceeded to take recourse to measures u/s 13(4), of SARFAESI Act by issuing possession notice dated 26.10.2023 and whereafter the Bank filed application under Section 14 of the SARFAESI Act, on 09.04.2025.

3. The Apex Court in R.D. Jain & Co. Versus Capital First Limited and Others, 2023 (1) SCC 675 while explaining the width and ambit of jurisdiction under section 14 SARFAESI Act held thus :-

“23. However, for taking physical possession of the secured assets in terms of Section 14 (1) of the SARFAESI Act, the secured creditor is obliged to approach the CMM/DM by way of a written application requesting for taking possession of the secured assets and documents relating thereto and for being forwarded to it (secured creditor) for further action. 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, to take possession of the secured assets and documents relating thereto and to forward the same to the secured creditor at the earliest opportunity.

24. As mandated by Section 14 of the SARFAESI Act, the CMM/DM has to act within the stipulated time-limit and pass a suitable order for the purpose of taking possession of the secured assets within a period of 30 days from the date of application which can be extended for such further period but not exceeding in the aggregate, sixty days. Thus, the powers exercised by the CMM/DM is a ministerial act. He cannot brook delay. Time is of the essence. This is the spirit of the special enactment.

25. As observed and held by this Court in NKGSB Coop. Bank [ NKGSB Coop. Bank Ltd. v. Subir Chakravarty , (2022) 10 SCC 286 : (2023) 1 SCC (Cri) 157] , the step taken by the CMM/DM while taking possession of the secured assets and documents relating thereto is a ministerial step. It could be taken by the CMM/DM himself/herself or through any officer subordinate to him/her, including the Advocate Commissioner who is considered as an officer of his/her court. Section 14 does not oblige the CMM/DM to go personally and take possession of the secured assets and documents relating thereto. Thus, we reiterate that the step to be taken by the CMM/DM under Section 14 of the SARFAESI Act, is a ministerial step. While disposing of the application under Section 14 of the SARFAESI Act, no element of quasi-judicial function or application of mind would require. The Magistrate has to adjudicate an