Answer: The secured creditor may request in writing the Chief Metropolitan Magistrate or District Magistrate within whose jurisdiction such secured asset is found to take possession of such secured asset and forward such secured asset to the secured creditor. Section 14(1) of Sarfaesi Act, 2002

Answer: Supreme Court of India, in the case of R.D Jain & Company Versus Capital First Ltd. and others reported in (2023)1 Supreme Court Cases Page 675, has held that the expression Chief Metropolitan Magistrate includes Additional Chief Metropolitan Magistrate (ACMM) and hence Additional Chief Metropolitan Magistrate can pass an order under Section 14 of the Sarfaesi Act, 2002 for taking over possession of the secured asset.

Answer: Supreme Court of India, in the case of R.D Jain & Company Versus Capital First Ltd. and others reported in (2023)1 Supreme Court Cases Page 675, has held that the expression District Magistrate includes Additional District Magistrate (ADM) and hence Additional District Magistrate can pass an order under Section 14 of the Sarfaesi Act, 2002 for taking over possession of the secured asset.

Answer: Supreme Court of India has held in the case of Authorised Officer, Indian Bank Versus D. Visalakshi reported in (2019)20 Supreme Court Cases Page 47 that the powers and functions of CMM and CJM are equivalent and similar in relation to maters specified in CrPC and these expressions (CMM and CJM) are interchangeable and synonymous to each other. Hence, Chief Judicial Magistrate is equally competent to deal with the applications filed by the secured creditor under Section 14 of the Sarfaesi Act, 2002.

Answer: It has been held in the case of NKGSB Co. Op. Bank Limited Versus Subir Chakraborty reported in (2022)10 Supreme Court Cases page 286 that advocate commissioner can be appointed to take possession of the secured assets and hand over the same to secured creditor

Answer: Section 14(1) of Sarfaesi Act, 2002 clearly provides that an application under Section 14 of the Sarfaesi Act, 2002 has to be made before the Chief Metropolitan Magistrate or District Magistrate, within whose jurisdiction, the secured assets may be situated.

Answer: Chief Metropolitan Magistrate or District Magistrate cannot authorise the secured creditor to himself take physical possession of the secured asset with police help.

Answer: It is not mandatory for the secured creditor to obtain an order under Section 14 of the Sarfaesi Act, 2002. It is open to the secured creditor to take physical possession of the secured assets without obtaining an order under Section 14 of the Sarfaesi Act, 2002. However, while taking physical possession of the secured assets the secured creditor cannot use force, cannot take the help of musclemen and the secured creditor cannot get the help of police for taking possession of the secured assets.

Answer: Section 14(1) of the Sarfaesi Act, 2002 provides that Chief Metropolitan Magistrate or District Magistrate shall take possession of the secured asset and forward the same to the secured creditor. However, it is not necessary for Chief Metropolitan Magistrate or District Magistrate to himself take possession of the secured assets. Section 14(1A) of the Sarfaesi Act, 2002 provides that the Chief Metropolitan Magistrate or District Magistrate may authorise any officer subordinate to him to take possession of the secured assets and to forward such assets to the secured creditor.

Answer: The application filed by the secured creditor before the Chief Metropolitan Magistrate or District Magistrate is to be accompanied by an affidavit duly affirmed by authorised officer of the secured creditor.

Answer : The affidavit to be filed by the Secured Creditor along with the application under Section 14 of Sarfaesi Act, 2002 should contain the under-mentioned details: 

the aggregate amount of financial assistance granted and the total claim of the Bank as on the date of filing the application;

1. ii) the borrower has created security interest over various properties and that the Bank or Financial Institution is holding a valid and subsisting security interest over such properties and the claim of the Bank or Institution is within the limitation period; 

iii) the borrower has created security interest over various properties giving the details of properties. 

(iv) the borrower has committed default in repayment of the financial assistance granted aggregating the specified amount;

(v) consequent upon such default in repayment of the financial assistance the account of the borrower has been classified as a non-performing asset; 

(vi) affirming that the period of sixty days notice as required by the provisions of sub-section (2) of section 13, demanding payment of the defaulted financial assistance has been served on the borrower;

(vii) the objection or representation in reply to the notice received from the borrower has been considered by the secured creditor and reasons for non-acceptance of such objection or representation had been communicated to the borrower;

(viii) the borrower has not made any repayment of the financial assistance in spite of the above notice and the Authorised Officer is, therefore, entitled to take possession of the secured assets. 

(ix) that the provisions of the Sarfaesi Act and the rules made thereunder had been complied with.

Answer : A Chief Metropolitan Magistrate or District Magistrate may pass the order for the purpose of taking possession of secured asset, after satisfying the contents of the affidavit filed by the secured creditor. It has been held that the such satisfaction has to be expressly recorded by the Chief Metropolitan Magistrate or District Magistrate. In the case of Standard Chartered Bank Versus V. Noble Kumar reported in (2013)9 Supreme Court Cases Page 620, Supreme Court of India held as follows:- “The satisfaction of the Magistrate under Section 14(1) requires the Magistrate to examine the factual correctness of the assertions made in such an affidavit but not the legal niceties of the transaction. It is only after recording of his satisfaction, the Magistrate can pass appropriate orders regarding taking of possession of the secured creditor.

Answer: It has been held by courts that if, while passing the order under Section 14 of the Sarfaesi Act, 2002, the Chief Metropolitan Magistrate or District Magistrate does not record his satisfaction about the contents of the affidavit, the order under Section 14 of the Sarfaesi Act, 2002 may be set aside or quashed.

Answer: The second proviso to Section 14(1) of the Sarfaesi Act, 2002 provides that an order under Section 14 of the Sarfaesi Act, 2002 shall be passed within a period of thirty days from the date of application. The third proviso to Section 14(1) of the Sarfaesi Act, 2002 provides that if no order is passed by Chief Metropolitan Magistrate or District Magistrate within a period of thirty days, he may, after according reasons in writing, pass the order within such period not exceeding in aggregate sixty days.

Answer: It has been held by Supreme Court of India that the time limit for passing an order under Section 14 of the Sarfaesi Act, 2002 has been prescribed for the benefit of the secured creditor and hence the borrower cannot get the said order set aside on the ground of delay in passing the said order. The Supreme Court further held that the time of 30 days or 60 days under Section 14 of Sarfaesi Act, 2002 is not mandatory, but only directory. C. Bright Versus District Collector reported in (2021)2 Supreme Court Cases Page 392

Answer : The Chief Metropolitan Magistrate or District Magistrate or the officer appointed by them can take police help for the purpose of taking physical possession of the secured assets and can use such force as in his opinion may be necessary. Section 14(2) of Sarfaesi Act, 2002

Answer: No act of the Chief Metropolitan Magistrate or the District Magistrate any officer authorised by the Chief Metropolitan Magistrate or District Magistrate done in pursuance of Section 14 of Sarfaesi Act, 2002 shall be called in question in any court or before any authority. Section 14(3) of Sarfaesi Act, 2002.

Answer : The Borrower can challenge the order under Section 14 of Sarfaesi Act, 2002 in Debts Recovery Tribunals by filing an application under Section 17 of the Sarfaesi Act, 2002. The bar or restriction under Section 14(3) of Sarfaesi Act, 2002 does not apply to an application before Debts Recovery Tribunal under Section 17 of the Sarfaesi Act, 2002. In the case of Kanaiyalal Versus Lalchand Sachdeo Versus State of Maharashtra reported in (2011)2 Supreme Court Cases page 782, the Supreme Court held that an application under Section 14 of the Sarfaesi Act, 2002 constitutes an action taken after the stage of Section 13(4) of Sarfaesi Act, 2002 and would fall within the ambit of Section 17(1) of the said act.

Answer : A borrower cannot file a writ Petition under Article 226 or Article 227 of Constitution of India against an order under Section 14 of the Sarfaesi Act, 2002, because the borrower has an alternative remedy under Section 17 of the Sarfaesi Act, 2002. However, High Court always has discretion in the matter. Case laws – (1) Kanaiyalal Versus Lalchand Sachdeo Versus State of Maharashtra reported in (2011)2 Supreme Court Cases page 782 and (2) United Bank of India Versus Satyawati Tandon reported in (2010)8 Supreme Court Cases Page 110

Answer : Chief Metropolitan Magistrate or District Magistrate is not required to issue any notice to the Borrower before passing order under Section 14 of the Sarfaesi Act, 2002.

Answer : Chief Metropolitan Magistrate or District Magistrate is not bound to give hearing to the borrower if he appears before the Chief Metropolitan Magistrate or District Magistrate even without any notice from the court

Answer : The Chief Metropolitan Magistrate or District Magistrate is not entitled to grant instalments to Borrower

Answer : The Chief Metropolitan Magistrate or District Magistrate is not entitled to make investigation into the claim of the Bank and reject it on merits. In the case of Balkrishna Rama Tarle Dead through legal representative Versus Phoenix ARC Pvt. Ltd. reported in (2023)1 Supreme Court Cases Page 662, Supreme Court of India held that the powers under Section 14 of the Sarfaesi Act, 2002 are ministerial steps and Section 14 of Sarfaesi Act, 2002 does not involve any adjudicatory process qua the points raised by the borrower.

Answer : The Chief Metropolitan Magistrate or District Magistrate is entitled to take possession of a running factory or showroom under Section 14 of the Sarfaesi Act, 2002.

Answer : The possession may be taken of a residential premises by ousting the occupants under Section 14 of the Sarfaesi Act, 2002.

Answer: In appropriate cases Debts Recovery Tribunal is entitled to stay the order passed under Section 14 of the Sarfaesi Act, 2002

Answer: A Secured Creditor is entitled to take physical possession of Secured Asset without obtaining an order under Section 14 of Sarfaesi Act, 2002. The secured creditor is required to make an application under Section 14 of Sarfaesi Act, 2002 when the borrower offers resistance and does not allow the secured creditor to take physical possession.