IN THE HIGH COURT OF UTTARAKHAND

AT NAINITAL

ON THE 19^TH DAY OF APRIL, 2023

BEFORE:

HON’BLE SHRI JUSTICE MANOJ KUMAR TIWARI

WRIT PETITION (M/S) No. 1125 of 2023

BETWEEN:

M/S Shantiram

Agro Industries & others.

…….Petitioners

(By Mr. Vijay Bhatt, Advocate)

AND:

State of Uttarakhand & others.

….Respondents

(Mr. Vinod Nautiyal, Deputy Advocate General for the State of

Uttarakhand/respondent nos. 1 & 2 and Mr. Siddhartha Jain,

Advocate for respondent no. 4)

JUDGMENT

Heard learned counsel for the parties.

2.

Petitioners took different loans from Punjab

National Bank Branch Kashipur, on different dates.

Since petitioners could not repay the loan in time,

therefore, recovery proceedings have been initiated

against them, by invoking provisions of Securitisation

and Reconstruction of Financial Assets and Enforcement

of Security Interest Act, 2002 (for short ‘SARFAESI Act,

2002’).

3.

In

this

writ

petition,

petitioners

have

challenged an order passed by District Magistrate,

Udham Singh Nagar in exercise of power under Section

14 of SARFAESI Act, 2002.

2

4.

It is contended on behalf of petitioners that

petitioners’ property is worth many times more than the

amount, which is to be recovered from petitioners, and

respondent-bank is trying to sell off petitioners’

property, at throwaway price. It is further contended

that the secured asset, which petitioners are trying to

sell is agricultural land, therefore, exempted from

recovery proceedings, in view of provision contained in

Section 31(i) of SARFAESI Act, 2002. Various other

arguments were made on behalf of petitioners.

5.

Hon’ble Supreme Court in the case of Kotak

Mahindra Bank v. Girnar Corrugators Pvt. Ltd., reported

in AIR (2023) Supreme Court 268 has held as under:-

“10. Even otherwise the Naib Tahsildar was

not at all justified in not taking possession of the

secured assets/properties as per order dated 24-9-

2014 passed by the District Magistrate under

Section 14 of the SARFAESI Act. The order passed

by the Naib Tahsildar refusing to take possession of

the secured assets/properties despite the order

passed under Section 14 of the SARFAESI Act on

the ground that recovery certificates issued by

Respondent 1 for recovery of the orders passed by

the Facilitation Council are pending, is wholly

without jurisdiction. While exercising power under

Section 14 of the SARFAESI Act, even the District

Magistrate

has

no

jurisdiction

and/or

District

Magistrate and/or even the Chief Metropolitan

Magistrate has no jurisdiction to adjudicate the

dispute between secured creditor and debtor. Under

Section

14

of

the SARFAESI Act,

the

District

Magistrate or the Chief Metropolitan Magistrate as

the case may be is required to assist the secured

creditor in getting the possession of the secured

assets. Under Section 14 of the SARFAESI Act,

neither the District Magistrate nor the Metropolitan

Magistrate would have any jurisdiction to adjudicate

and/or decide the dispute even between the secured

creditor and the debtor. If any person is aggrieved

by the steps under Section 13(4)/order passed

under Section 14, then the aggrieved person has to

approach the Debts Recovery Tribunal by way of

appeal/application

under

Section

17

of

the SARFAESI Act. Therefore, the order passed by

the Naib Tahsildar refusing to take the possession

pursuant to the order passed by the District

Magistrate under Section 14 of the SARFAESI Act

was wholly without jurisdiction and therefore also

the same was liable to be set aside.

3

11. In view of the above and further reasons

stated above, the impugned judgment and order

passed by the Division Bench of the High Court is

unsustainable and the same deserves to be quashed

and set aside. Consequently, the present appeal is

allowed. The impugned judgment and order dated

11-8-2017 passed by the Divis