S. Shantha v. Chief Judicial Magistrate, Coimbatore
2011-04-25
D.MURUGESAN, K.K.SASIDHARAN
body2011
DigiLaw.ai
Judgment :- D. MURUGESAN, J. 1. When the miscellaneous petition seeking for stay of the impugned order passed by the learned Chief Judicial Magistrate, Coimbatore, is taken up for hearing, by consent the main writ petition itself is considered and disposed of by the following order. 2. The petitioner's son viz., Thiru.S.Palaniappan, the second respondent, availed loan from the third respondent Syndicate Bank, Coimbatore Branch and defaulted in repayment. For availing loan, he had mortgaged a plot measuring an extent of 1838 sq.ft. in Kumarapalayam Village, Coimbatore District and the building thereon. 3. The bank has proceeded by issuance of notice under Section 13(2) of SARFAESI Act followed by notice under Section 13(4) and it appears that those notices have been sent to the second respondent, Palaniappan. The petitioner, viz., the mother of the said Palaniappan, has questioned the possession notice before the Debts Recovery Tribunal on the ground that she has right over the property and the second respondent, without her consent, mortgaged the property in favour of the bank and had availed the loan. That SARFAESI Application is still pending. In the meantime, the bank has approached the Chief Judicial Magistrate, Coimbatore, under Section 14 of the Act to take physical possession of the property in C.M.P.No.1105 of 2009. By order dated 1.1.2010, the Chief Judicial Magistrate, Coimbatore, has directed as follows:- "Whereas it is deemed requisite for the purpose of this petition that a commission should be issued. You are hereby appointed as Commissioner for the purpose of taking possession of the petition mentioned property described hereunder to take possession of the secured assets mentioned in the Schedule and to hand over the same to the Authorised Officer of the petitioner Bank with the assistance of the Inspector of Police, B-10 Selvapuram Police Station, Coimbatore. A sum of Rs.20,000/- (Rupees twenty thousand only) being your fee in the above and the same will be paid directly by the petitioner." 5. We have heard the respective learned counsel appearing for the petitioner and the third respondent-bank. The order questioned in this writ petition suffers from legal infirmity and at any stretch of imagination, it cannot be either accepted or recognised by this Court.
We have heard the respective learned counsel appearing for the petitioner and the third respondent-bank. The order questioned in this writ petition suffers from legal infirmity and at any stretch of imagination, it cannot be either accepted or recognised by this Court. The Chief Judicial Magistrate is empowered to entertain an application under Section 14 of the SARFAESI Act filed by the bank seeking for appointment of an Advocate Commissioner to take physical possession of the secured asset. Nevertheless, as to how such an application should be dealt with, there are no rules framed for that purpose. In such event, the learned Magistrate should look into the application based upon the decided cases by this Court as well as the Apex Court. It has been consistently held that when an application under Section 14 is filed, it is the primary duty of the Magistrate to first consider whether he has got territorial jurisdiction to entertain such application and secondly, whether the provision of Section 13(2) had been followed by the bank before approaching the Court under Section 14. 6. This Court, in the judgment reported in 2010 CIJ 386 CLJ, (V.Noble Kumar vs. The Authorised Officer, Standard Chartered Bank, Auto and Mortgage Collections, Chennai and others), has elaborately considered the manner in which such applications are to be considered. This Court had considered the strict compliance of the provisions keeping in mind the right of a citizen over the property under Article 300A of the Constitution of India. First of all, the Magistrate has to consider whether the bank has declared the debt as Non-Performing Asset; secondly, whether after such declaration, notice under Section 13(2) was issued in terms of that provision; and thirdly, whether the bank has taken measures for taking possession under Section 13(4) and whether there are any resistance by the person in occupation of the premises. In the event, the above procedures are complied with by the bank, the Magistrate can certainly entertain the application and order for appointing an Advocate Commissioner to take physical possession of the secured asset. Of course, while considering the application under Section 14, the Magistrate is only performing ministerial function. Nevertheless, as he deals with the property of a citizen, he is duty bound to consider as to whether the above provisions are strictly complied with.
Of course, while considering the application under Section 14, the Magistrate is only performing ministerial function. Nevertheless, as he deals with the property of a citizen, he is duty bound to consider as to whether the above provisions are strictly complied with. He is not expected to go into the validity of either the declaration of the asset as Non-Performing Asset or the notice under Section 13(2) or 13(4), but should only find out whether the procedures have been followed before the application under Section 14 is considered. 7. The order of the Chief Judicial Magistrate, which we have extracted in the earlier portion, does not indicate any application of mind and for that purpose, we have directed the learned counsel appearing for the petitioner and the respondent-bank to produce the detailed copies if any. Accordingly, the certified copy of the proceedings under Section 14 are filed. We have perused and to say the worst, the learned Magistrate has only made an endorsement in the docket while he passed the above order, which shows that there is total non-application of mind and for that reason alone, the impugned order is liable to be set aside. Accordingly, the impugned order dated 01.01.2010 is set aside and the matter stands remitted to the learned Chief Judicial Magistrate, Coimbatore, for fresh consideration. 8. The learned counsel appearing for the third respondent-bank has fairly submitted that pursuant to the appointment of an Advocate Commissioner, the possession of the property in question had been partly taken. As the order has been set aside and the matter is remitted back to the Magistrate for fresh consideration, we direct the third respondent-bank to restore the possession to the petitioner and in the event the bank is to pursue with the application under Section 14, they shall report the same to the learned Magistrate. If the possession is restored, the learned Magistrate is directed to consider the application under Section 14 afresh by applying his mind to the facts which we have observed in this order and particularly taking into consideration the directions contained in the Noble Kumar's case, cited supra. 9. The writ petition is accordingly allowed with the above direction. No costs. Consequently, connected M.P. is closed.