R.D. Jain and Co. Vs. Capital First Ltd. and Ors. - (Supreme Court) (27 Jul 2022)

Expression "District Magistrate" and the "Chief Metropolitan Magistrate" under Section 14 of the SARFAESI Act includes Additional District Magistrate and Additional Chief Metropolitan Magistrate

MANU/SC/0926/2022

Commercial

The borrower has preferred the present appeal against impugned judgment and order passed by the High Court, by which, the Division Bench of the High Court while interpreting Section 14 of the Securitisation and Reconstruction of Financial Assets and Enforcement Security Interest Act, 2002 ("SARFAESI Act") has held that (i) the District Magistrate, Chief Metropolitan Magistrate is not a persona designata for the purposes of Section 14 of the SARFAESI Act; (ii) the expression "District Magistrate" and the "Chief Metropolitan Magistrate" as appearing in Section 14 of the SARFAESI Act shall deem to mean and include Additional District Magistrate and Additional Chief Metropolitan Magistrate for the purposes of Section 14 of the SARFAESI Act.

In view of the scheme of the SARFAESI Act, more particularly, Section 14 of the SARFAESI Act and the nature of the powers to be exercised by learned Chief Metropolitan Magistrate/learned District Magistrate, the High Court in the impugned judgment and order has rightly observed and held that, the power vested in the learned Chief Metropolitan Magistrate/learned District Magistrate is not by way of persona designata.

The expression "Chief Metropolitan Magistrate" as appearing in Section 14 of the SARFAESI Act shall deem to mean and include Additional Chief Metropolitan Magistrate for the purposes of Section 14 of the SARFAESI Act. When the Additional District Magistrates are conferred with the powers to be exercised by the District Magistrates either by delegation and/or by special orders and the Additional District Magistrates are exercising the same powers which are being exercised by the District Magistrates, the same analogy can be applied, more particularly, when the powers exercisable under Section 14 of the SARFAESI Act, are ministerial steps.

The District Magistrate, Chief Metropolitan Magistrate is not a persona designata for the purposes of Section 14 of the SARFAESI Act. The powers under Section 14 of the SARFAESI Act can be exercised by the concerned Additional Chief Metropolitan Magistrates of the area having jurisdiction and also by the Additional District Magistrates, who otherwise are exercising the powers at par with the concerned District Magistrates either by delegation and/or special order. Appeal dismissed.

Tags : POWERS INCLUSION JURISDICTION