[Cites 8, Cited by 0]
Punjab-Haryana High Court
Au Small Finance Bank Limited vs District Magistrate / Deputy ... on 18 February, 2026
CWP-4902-2026
2026 -1-
128
IN THE HIGH COURT OF PUNJAB AND HARYANA
AT CHANDIGARH
CWP-4902-2026
2026
Date of decision : 18.02.202
.2026
AU Small Finance Bank Ltd.
.......Petitioner
Versus
Deputy Commissioner cum District Magistrate, Ludhiana and others
.......Respondents
CORAM: HON'BLE MR. JUSTICE SHEEL NAGU, CHIEF JUSTICE
HON'BLE MR. JUSTICE SANJIV BERRY
Present: Mr. Nitin Thatai, Advocate (through video conferencing),
for the petitioner.
Mr. Salil Sabhlok, Senior DAG, Punjab.
****
SHEEL NAGU, CHIEF JUSTICE ( Oral )
1. The petitioner - bank is before this Court invoking writ as well as
supervisory jurisdiction under Article 226/227 of the Constitution of India,
being aggrieved by in-action
in action on the part of District Magistrate, Ludhiana
(respondent No.1)
No. to decide application dated 13.11.2025 (Annexure P-2)) filed
by the petitioner u/s 14 of the Securitisation and Reconstruction of Financial
Assets and Enforcement of Security Interest Act, 2002 (in short, 'SARFAESI
Act').
1.1 It is mentioned in the petition that no proceedings under
SARFAESI Act are pending before DRT or DRAT.
2. It is stated in the application (Annexure P
P-2)) that respondents
No.2 to 9 availed loan of Rs. 8,44,04,000//- from the petitioner vide two loan
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CWP-4902-2026
accounts, and upon default in repayment, the account
accounts were classified as Non-
Non
Performing Asset (NPA) on 29.07.2025,
.2025, whereafter notice u/s 13 (2) of
SARFAESI Act (Annexure P-1)
P 1) was issued to the respondents - borrowers on
05.08.2025,
.08.2025, calling upon them to discharge th
their
eir liability within a period of
sixty days. The respondents - borrowers failed to comply with the said
demand and, accordingly, the secured creditor proceeded to take recourse to
measures u/s 13 (4) of SARFAESI Act by issuing possession notice.
Thereafter,, the petitioner - secured creditor filed application u/s 14 of the
SARFAESI Act on 13.11.2025.
3. The Apex Court in R.D. Jain & Co. Vs. Capital First Limited
and others, (2023) 1 SCC 675, while explaining the width and ambit of
jurisdiction u/s 14 of SARFAESI
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
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.
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CWP-4902-2026
24. As mandated
ndated by Section 14 of the SARFAESI Act,
the CMM/DM has to act within the stipulated time
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 exten
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 : (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
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 and decide the correctness of
the information given in the application and nothing more.
Therefore, Section 14 does not involve an adjudicatory
process qua points raised by the borrower against the
secured creditor taking possession of secured assets.
assets."
3.1 Needless to say that the guidelines laid down by Coordinate
Bench in Bank of Maharashtra Vs. District Magistrate, Hisar and others,
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CWP-4902-2026
(CWP-7018
7018-2022, decided on 28.05.2024) be adhered to by the concerned
authorities.
4. This Court, in view of District Magistrate, Ludhiana (respondent
No.1)) having failed to discharge statutory obligation u/s 14 (1) proviso of the
SARFAESI Act within stipulated time of sixty days, is compelled to issue writ
of mandamus.
5. Accordingly, the present petition is disposed of with a direction to
respondent No.1
No. to consider and dispose
ispose of the application u/s 14 of the
SARFAESI Act (Annexure P-2),
P expeditiously, prefer
preferably on the date already
eady
fixed,, or at best, within a period of thirty (30) days thereafter
thereafter.
6. We hasten to add that this order shall however be subject to any
restraint/interim/final order which may have been passed by any judicial
forum, in favour of the borrowers/guaranto
borrowers/guarantors/any
rs/any aggrieved person, who is
party to this lis.
( SHEEL NAGU )
CHIEF JUSTICE
( SANJIV BERRY )
February 18, 2026 JUDGE
narotam
Whether speaking/reasoned Yes/No
Whether reportable Yes/No
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