Recently, the single judge bench of the Calcutta High Court, while dealing with the writ petition challenging the rejection of the petitioner’s application under Section 14 of the Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (hereinafter referred to as "the Act") by the District Magistrate on the grounds of material deficiencies in the affidavit, held that the power under Section 14 can be exercised only upon strict adherence to all the prescribed statutory conditions. The Court emphasized that any deviation or incomplete compliance cannot be retrospectively cured merely by asserting that there has been specific compliance.
Brief facts
The factual matrix of the case is that the respondent no. 2, the borrower had availed a loan facility from the petitioner-bank and failed to repay the same and the loan account was classified as Non Performing Asset (NPA). The petitioner accordingly initiated proceedings under the Act and issued a demand notice under Section 13(2) of the Act. The borrower submitted his reply thereto. After complying with the statutory requirements under Section 13(2) and 13(3A) of the Act, the petitioner proceeded to take symbolic possession of the mortgaged property and issued a possession notice under Section 13(4) of the Act. Thereafter, the petitioner filed an application before the District Magistrate under Section 14 of the Act, seeking assistance for taking physical possession of the property. However, the District Magistrate rejected the application while pointing out defects in the affidavit. Therefore, the present writ petition.
Observations of the Court
The Court examined that under Section 14(1) of the Act, when a secured creditor requires theassistance of the District Magistrate or the Chief Metropolitan Magistrate as the case may be, for taking possession of the secured assets, such assistance may be sought by making an application in writing. The first proviso to Section 14 (1) mandates that the application must be accompanied by an affidavit duly affirmed by the authorized officer of the secured creditor, containing the particulars as specified under Rule 8 of the Security Interest (Enforcement) Rules, 2002 and the central government notification dated 17.09.2013.
Moreover, the District Magistrate, while considering such an application, is not required to adjudicate upon any rights or objections raised by the borrower but is instead expected to confine himself to verifying whether the application is supported by a valid and complete affidavit and whether the conditions laid down under the statute, including those prescribed under Rule 8, have been duly complied with.
The Court observed that in the present case, the affidavit submitted by the Petitioner does not conform to the mandatory requirements laid down under the first proviso to Section 14(1) of the Act and the applicable rules, and the District Magistrate has noted the defects.
The Court noted that “the absence of key particulars required under Rule 8 and the failure to submit a valid affidavit as mandated under first proviso to Section 14(1) vitiates the entire application. Since the jurisdiction of the District Magistrate under Section 14 of the Act, is not ministerial and not adjudicatory, such defects cannot be cured retrospectively or assumed to be merely procedural.”
The Court furthermore noted that the contention raised by the Petitioner that all relevant documents were submitted cannot be accepted as sufficient, particularly when the affidavit itself is deficient and there is non compliance with the requirements of the application filed under Section 14 of the Act. The Court emphasized that the power under Section 14 can be exercised only upon strict adherence to all the prescribed statutory conditions. Any deviation or incomplete compliance cannot be retrospectively cured merely by asserting that there has been specific compliance.
Based on these considerations, the Court was of the opinion that there exists no infirmity in the impugned order.
The decision of the court
With the above direction, the Court dismissed the Writ Petition.
Case Title: UCO Bank Versus District Magistrate and Collector, Cooch Behar & Anr
Coram: Hon’ble Mr. Justice Gaurang Kanth
Case No.: W. P. A. 56 OF 2025
Advocates for the Petitioner: Mr. Rahul Mishra, Adv Mr. Deborshi Dhar, Adv
Advocates for the State: Mr. Nabankur Paul, Adv Mr. Bikash Singha, Adv
Advocates for the Respondent: Mr. Debabrata Saha Roy, Adv Mr. Neil Basu, Adv Mr. Subhasish Misra, Adv Ms. Shreya Sarkar, Adv
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