Patna High Court
Cholamandalam Investment and Finance Co. Ltd.versusThe State of Bihar
- Decided
- Disposal
- DISPOSED
- Bench
- A ABHISHEK REDDY
Holding
The Court held that the District Magistrate’s role under Section 14 of the SARFAESI Act is a ministerial duty and must be performed expeditiously, directing the magistrate to act within eight weeks.
Summary
Cholamandalam Investment and Finance Co. Ltd. filed a writ petition alleging that the District Magistrate, Rohtas had not acted on its requisition under Section 14 of the SARFAESI Act to take possession of secured assets. The petitioner relied on a Supreme Court judgment interpreting Section 14 as imposing a ministerial duty on the magistrate to act promptly. The High Court examined the statutory language and the precedent, confirming that the magistrate must immediately verify compliance and forward the assets to the secured creditor. Consequently, the Court directed the District Magistrate to consider the petitioner's request within eight weeks. The writ petition was disposed of with the said direction.
Issues considered
- The District Magistrate’s duty under Section 14 of the SARFAESI Act to act on a secured creditor’s application.
- Whether the magistrate’s function under Section 14 is ministerial or adjudicatory.
- Whether the High Court can issue a direction compelling the magistrate to act within a specified time.
Legislation cited
Subjects
- SARFAESI Act
- Section 14
- ministerial duty
- secured creditor
- possession of secured assets
- writ petition
- district magistrate
- High Court direction
Judgment
IN THE HIGH COURT OF JUDICATURE AT PATNA
Civil Writ Jurisdiction Case No.9953 of 2026
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Cholamandalam Investment and Finance Co. Ltd. having its Registered office
at CHOLA CREST C-54 and 55 SUPER B-4, Thiru Vi Ka Industrial Estate,
Guinday, Chennai-600037 and its Branch Office at Ahluwalia Building,
Exhibition Road, Near Prema Honda Service Center, Patna Bihar 800001 and
represented through Area Legal Manager and authorised representative Manoj
Kumar Pandey, aged about 45 Years.
... ... Petitioner/s
Versus
1. The State of Bihar through the Principal Secretary, General Administration,
Government of Bihar, New Secretariat, Bailey Road, Patna -800014.
2. The District Magistrate, Rohtas.
3. The In Charge Officer, District Certificate Section, Rohtas.
... ... Respondent/s
======================================================
Appearance :
For the Petitioner/s : Mr.Dayanand Singh
For the Respondent/s : Mr.Standing Counsel (09)
======================================================
CORAM: HONOURABLE MR. JUSTICE A. ABHISHEK REDDY
ORAL ORDER
2 09-07-2026 Without going into the merits or demerits of the case,
the present writ petition is disposed of at the stage of admission
with the consent of both the Counsels.
2. Learned counsel appearing on behalf of the
petitioner submits that the Petitioner- Cholamandalam
Investment and Finance Co. Ltd. has sent a requisition to the
District Magistrate, Rohtas under Section 14 of the SARFAESI
Act, however, the authority till date has not taken any action on
the same. Learned counsel submits that it will suffice for the
present if a direction is given to the District Magistrate, Rohtas
to consider the request made by the petitioner under Section 14
Patna High Court CWJC No.9953 of 2026(2) dt.09-07-2026
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of the SARFAESI Act and take a suitable action as per the
provisions of the SARFAESI Act. Learned counsel has relied on
a Judgment of the Hon’ble Supreme Court in the case of
Balkrishna Rama Tarle Dead through legal representatives
and Anr. Versus Phonix ARC Private Limited and Ors.
reported in (2023) 1 Supreme Court Cases 662, whereby the
Hon’ble Supreme Court has held as under:-
“15. On a fair reading of Section 14
of the SARFAESI Act, it appears that for taking
possession of the secured assets in terms of
Section 14(1) of the SARFAESI Act, the secured
creditor is obliged to approach the District
Magistrate/Chief Metropolitan Magistrate 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.
16. 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 in the proviso in Section
14(1) of the SARFAESI Act and after being
satisfied in that regard, to take possession of the
Patna High Court CWJC No.9953 of 2026(2) dt.09-07-2026
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secured assets and documents relating thereto
and to forward the same to the secured creditor
at the earliest opportunity. As observed and held
by this Court in NKGSB Coop. Bank Ltd. v.
Subir Chakravarty [NKGSB Coop. Bank Ltd. v.
Subir Chakravarty, (2022) 10 SCC 286 : (2023)
1 SCC (Cri) 157] , the aforesaid act is a
ministerial act. It cannot brook delay. Time is of
the essence and this is the spirit of the special
enactment.
18. Thus, the powers exercisable by
CMM/DM under Section 14 of the SARFAESI
Act are ministerial steps and Section 14 does
not involve any adjudicatory process qua points
raised by the borrowers against the secured
creditor taking possession of the secured assets.
In that view of the matter once all the
requirements under Section 14 of the SARFAESI
Act are complied with/satisfied by the secured
creditor, it is the duty cast upon the CMM/DM
to assist the secured creditor in obtaining the
possession as well as the documents related to
the secured assets even with the help of any
officer subordinate to him and/or with the help
of an advocate appointed as Advocate
Commissioner. At that stage, the CMM/DM is
not required to adjudicate the dispute between
the borrower and the secured creditor and/or
between any other third party and the secured
creditor with respect to the secured assets and
the aggrieved party to be relegated to raise
objections in the proceedings under Section 17
Patna High Court CWJC No.9953 of 2026(2) dt.09-07-2026
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of the SARFAESI Act, before the Debts Recovery
Tribunal.
3. Having regard to the above made submissions and
the law laid down by the Hon’ble Supreme Court in the above
mentioned case, this Court deems it expedient to dispose of the
present CWJC by directing the District Magistrate, Rohtas
(Respondent No. 2) to act on the request made by the petitioner.
The present writ petition is accordingly disposed of directing the
District Magistrate, Rohtas (Respondent No. 2) to consider the
request made by the petitioner as expeditiously as possible
preferably within a period of eight weeks from the date of
receipt of the copy of this order.
4. With the above directions, the present writ petition
stands disposed of.
(A. Abhishek Reddy, J)
Ayush/-
U
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