IMPORTANT POINT
Nomenclature ‘Chief Metropolitan Magistrate’ used in Section 14 of Act, 2002 is inclusive of ‘Chief Judicial Magistrate’ functioning in a non-metropolitan area and shall have jurisdiction to entertain an application made by a secured creditor under Section 14 of Act, 2002.

Krishna Murari, J.—Heard Shri Neeraj Kumar Pandey, learned counsel for the petitioner, learned Standing Counsel for respondent nos. 1, 2 and 5 and Shri Sandeep Arora for respondent no. 3-Bank.

2. Admittedly, late father of the petitioner took two loans from respondent no. 3-Bank and mortgaged the property bearing khasra no. 762, area 1128 sq. ft. situated in Rudrapur and another residential plot nos. 820 and 821, area 2128 sq. ft. as security to the said loans. The dispute in the present writ petition is in respect of the khasra no. 762. Late father of the petitioner defaulted in making repayment, as a result, proceedings under Section 13 of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (hereinafter referred to as the ‘Act, 2002’) was initiated. Notice under Section 13 (2) of the Act, 2002 was issued and subsequently after notice under Section 13 (4) of the Act, 2002, the respondent-Bank made an application under Section 14 of the Act, 2002 before the Chief Judicial Magistrate seeking assistance in taking possession of the secured asset. Chief Judicial Magistrate vide order dated 18.03.2016, impugned in this petition, allowed the application and directed the concerned police station to assist the Bank in taking over possession of the mortgaged property and Sub Divisional Magistrate was directed to make an inventory of the articles in the mortgaged property.

3. Learned counsel for the petitioner contends that since Section 14 of the Act, 2002 only authorises either the Chief Metropolitan Magistrate or the District Magistrate to entertain and pass orders on the application made under the said Section, as such, the impugned order passed by the Chief Judicial Magistrate is patently without jurisdiction and is not liable to be sustained. It is further submitted that since Act, 2002 is a self contained code and the language of Section 14 is clear and unambiguous, no jurisdiction can be said to vest with the Chief Judicial Magistrate to exercise the power under Section 14 of the Act. He further submits that the power is to be exercised by the Chief Metropolitan Magistrate under the provisions of the Act, the same cannot be delegated to a Chief Judicial Magistrate by giving a wider meaning to the nomenclature to the Chief Metropolitan Magistrate and if the Legislature has omitted the use of word ‘Chief Judicial Magistrate’, the Court cannot supply the omission and it can only interpret the law.

4. On the other hand, learned counsel for the respondent-Bank submits that the very purpose of the enactment, viz., the expeditious recovery of bad loans classified as Non Performing Asset, would fail, if the Chief Judicial Magistrate is excluded from exercising the power conferred by Section 14 of the Act, 2002. He points out that only a few areas in the State of U.P. has been declared to be metropolitan areas where the Chief Metropolitan Magistrate functions and in most of the areas, there are Chief Judicial Magistrate and, in case, if he is excluded from exercising the power conferred by Section 14 of the Act, it would result in endless delay in recovery of debts of the Banks and financial institutions frustrating the very purpose of the Legislature enacting the Act, 2002 for speedy recovery of the loans.

5. The core issue, which arises for reconsideration is whether the Chief Judicial Magistrate exercising jurisdiction in non metropolitan area in exercise of powers conferred by Section 14 of the Act, 2002 can assist a secured creditor in taking possession of the secured asset and pass an order in favour of the secured creditor for the purpose of taking possession or control of any secured asset.

6. This issue has been subject matter of consideration before various High Courts, who have expressed divergent views, however, no authoritative pronouncement by the Hon’ble Apex Court or by this Court, has been placed before us.

7. A Full Bench of Madras High Court in K. Arockiyaraj