REPORTABLE
IN THE SUPREME COURT OF INDIA
CIVIL APPELLATE JURISDICTION
CIVIL APPEAL NO.  175 OF 2022
M/s R.D. Jain and Co.       …Appellant(s)
Versus
Capital First Ltd. & Ors.    …Respondent(s)
J U D G M E N T
M.R. SHAH, J.
1. Feeling   aggrieved   and   dissatisfied   with   the   impugned
judgment  and order  dated 22.12.2017 passed  by  the  High
Court   of   Judicature   at   Bombay   in   Writ   Petition   No.
1961/2017,   by   which,   the   Division   Bench   of   the   High
Court   while   interpreting   Section   14   of   the   Securitisation
and   Reconstruction   of   Financial   Assets   and   Enforcement
Security   Interest   Act,   2002   (hereinafter   referred   to   as   the
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“SARFAESI   Act”)   has   held   that   (i)   the   District   Magistrate,
Chief   Metropolitan   Magistrate   is   not   a   persona   designata
for the purposes of Section 14 of the SARFAESI Act; (ii) the
expression   “District   Magistrate”   and   the   “Chief
Metropolitan Magistrate” as appearing in Section 14 of the
SARFAESI   Act   shall  deem   to   mean   and   include  Additional
District   Magistrate   and   Additional   Chief   Metropolitan
Magistrate for the purposes of Section 14 of the SARFAESI
Act, the borrower has preferred the present appeal.  
2. The facts leading to the present appeal in a nutshell are as
under: ­
2.1 That   respondent   No.   1   herein   –   Financial   Institution   –
Capital   First   Limited   is   the   secured   creditor   (hereinafter
referred  to as  the  “secured  creditor”) within  the  meaning  of
Section   2(1)(zd)   of   the   SARFAESI   Act.   That   the   secured
creditor  instituted proceedings under the SARFAESI Act for
recovery   of   the   amount   due   and   payable   by   the   appellant
herein   –   borrower.   The   said   proceedings   initiated   under
Section   13(4)   of   the   SARFAESI   Act,   the   secured   creditor
proceeded to take possession of the secured asset. However,
the   borrowers   refused   to   handover   the   physical   possession
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of   the   secured   asset.   The   secured   creditor   took   symbolic
possession   of   the   secured   asset   on   21.01.2017   and   affixed
the   possession   notice   at   the   said   secured   asset.   That   on
17.03.2017, the  secured creditor  filed an application  under
Section   14   of   the   SARFAESI   Act   with   the   learned   Chief
Metropolitan   Magistrate   Court,   Esplanade,   Mumbai,   inter­
alia,   praying   for   assistance   from   the   learned   Chief
Metropolitan Magistrate in taking physical possession of the
secured asset. The matter was adjourned from time to time
and lastly, it was adjourned to 29.07.2017. As mandated by
second   proviso   to   sub­section   (1)   of   Section   14   of   the
SARFAESI  Act, the application was required to be disposed
of within a period of 30 days and as the application was not
decided   within   the   period   mandated   by   the   statute,   the
secured creditor moved an application for advancement. The
said application  came to  be dismissed by  the  learned  Chief
Metropolitan   Magistrate,   inter­alia,   on   the   ground   that   the
said   application   is   a   fresh   application   and   many   old
applications   are   pending.   Therefore,   the   secured   creditor
approached   the   High   Court   by   way   of   the   present   writ
petition for an appropriate direction and order directing the
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learned   Chief   Metropolitan   Magistrate   to   dispose   of   their
cases/applications under Section 14 of the SARFAESI Act in
a time bound manner.
2.2 That the Division Bench of the High Court issued directions
to   the   learned   Chief   Metropolitan   Magistrate   to   make   an
endeavour   to   dispose   of   the   pending   applications   as
expeditiously   as   possible   and   preferably   within   a   period   of
thirty   days   from   the   date   of   receipt   of   writ   along   with   the
order.   The   learned   Chief   Metropolitan   Magistrate   vide
communication   dated   14.08.2017   brought   to   the   notice   of
the High Court that, “Even though, the SARFAESI Act, 2002
provides   for   expeditious   disposal   of   the   applications   filed
under Section 14 of the said Act, there are as many as 924
cases  pending  under  the  said  Act  as  on  09.08.2017  on  the
file   of   the   Court   of   the   Chief   Metropolitan   Magistrate,
Esplanade,   Mumbai.   Out   of   924   cases,   509   cases   are   filed
in   the   year   2017.   However,   there   are   27   cases   of   the   year
2014, 96 cases of the  year  2015 and 291 cases of the year
2016,   still   pending   for   disposal.   As   per   the   direction   of   the
Hon’ble   High   Court,   preference   should   be   given   to   the   old
pending   cases   for   disposing   of   the   same.   Therefore,   the
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preference   is   being   given   to   the   pending   old   cases   rather
than fresh new cases.”   
2.3 On receiving the aforesaid report, the High Court was of the
opinion   that   considering   the   volume   of   applications   filed
under   Section   14   of   the   SARFAESI   Act   and   pendency   of
such   applications,   the   learned   Chief   Metropolitan
Magistrate,   who   is   an   authority   under   Section   14   of   the
SARFAESI   Act   cannot   decide   such   applications   within   a
time   bound   period   in   terms   of   the   first   and   second   proviso
to   Section   14(1)  of  the  SARFAESI  Act.  After  opining  so,  the
High   Court   proceeded   to   consider   the   issue   as   to   how   to
minimize   the   pendency.   In   this   context,   after   considering
the   relevant   provisions   of   the   SARFAESI   Act   as   well   as
Section   17(2)   and   Section   19   of   the   Code   of   Criminal
Procedure, the High Court has observed that the Additional
Chief   Metropolitan   Magistrate   (for   short   “ACMM”),   being
invested   with   all   the   judicial   powers   of   the   Chief
Metropolitan   Magistrate,   can   be   considered   at   par   with   the
Chief   Metropolitan   Magistrate.   The   High   Court   has   also
observed   that   so   far   as   the   exercise   of   judicial   powers   are
concerned,   the   Chief   Metropolitan   Magistrate   and   the
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Additional Chief Metropolitan Magistrate stand on the same
footing   and   one   cannot   be   said   to   be   either   inferior   or
subordinate   to   the   other.   It   is   further   observed   and   held
that   as   the   status   of   Chief   Metropolitan   Magistrate   and
Additional   Chief   Metropolitan   Magistrate   is   same   and
identical,   the   Additional   Chief   Metropolitan   Magistrate   can
exercise the powers under Section 14 of the SARFAESI Act.
While holding so, the Division Bench of the High Court has
heavily   relied   upon   the   decisions   of   the   Division   Bench   of
the   High   Court   in   the   case   of   State   of   Maharashtra   Vs.
Shanti   Prasad   Jain   in   Criminal   Reference   No.   9   of   1977
decided on 29.09.1977 by which, on a reference the Division
Bench of the High Court held and concluded that the Chief
Metropolitan   Magistrate   and   the   Additional   Chief
Metropolitan   Magistrate   are   courts   of   the   same   status
having the same or identical jurisdiction so far as the trial of
criminal   cases   is   concerned.   Further,   by   taking   into
consideration   the   fact   that   the   powers   of   the   Chief
Metropolitan Magistrate under  Section  14  of the  SARFAESI
Act   being   purely   executionary   in   nature   and   having   no
element  of quasi­judicial functions ultimately  it  is observed
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and held by the High Court as under: ­ 
“(I)  The   District   Magistrate,   Chief   Metropolitan
Magistrate   is   not   a   persona   designata   for   the
purposes of Section 14 of the SARFAESI Act.
(II)  The   expression   “District   Magistrate”   and   the
“Chief   Metropolitan   Magistrate”   as   appearing   in
Section   14   of   the   SARFAESI   Act   shall   deem   to
mean   and   include   Additional   District   Magistrate
and   Additional   Chief   Metropolitan   Magistrate   for
the purposes of Section 14 of the SARFAESI Act.” 
2.4 Feeling   aggrieved   and   dissatisfied   with   the   impugned
judgment and order  passed by the High Court holding that
the District Magistrate, Chief Metropolitan Magistrate is not
by   persona   designata   for   the   purposes   of   Section   14   of   the
SARFAESI Act and that the expression “District Magistrate”
and   the   “Chief   Metropolitan   Magistrate”   as   appearing   in
Section   14   of   the   SARFAESI   Act   shall   deem   to   mean   and
include   Additional   District   Magistrate   and   Additional   Chief
Metropolitan   Magistrate   for   the   purposes   of   Section   14   of
the   SARFAESI   Act,   the   borrower   has   preferred   the   present
appeal.                 
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3.   Shri   Purvish   Jitendra   Malkan,   learned   Advocate   has
appeared   on   behalf   of   the   appellant   –   borrower   and   Shri
Sachin   Patil,   learned   Advocate   has   appeared   on   behalf   of
the   State.   None   has   appeared   on   behalf   of   the   respondent
No. 1 – secured creditor. 
4. Shri   Malkan,   learned   counsel   appearing   on   behalf   of   the
borrower has vehemently submitted that the High Court has
committed   a   grave   error   in   holding   that   powers   under
Section   14   of   the   SARFAESI   Act   can   be   exercised   by   the
Additional   Chief   Metropolitan   Magistrate   and   Additional
District Magistrate also. It is vehemently submitted that the
High Court has also committed a very serious/grave error in
holding   that   the   District   Magistrate   and   the   Chief
Metropolitan   Magistrate   is   not   a   persona   designata   for   the
purposes of Section 14 of the SARFAESI Act. 
4.1 Shri   Malkan,   learned   counsel   appearing   on   behalf   of   the
borrower   has   submitted   that   the   impugned   judgment   and
order   passed   by   the   High   Court   is   just   contrary   to   the
decisions of the Gujarat High Court, Kerala High Court and
the Calcutta High Court. It is submitted that the High Court
of Gujarat, has been pleased to hold that: ­
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“1) District   Magistrate   and   Additional   District
Magistrate   are   two   different   and   distinct   authorities;
2) The   powers   conferred  on   the   District   Magistrate
or  the Chief Metropolitan Magistrate,  as  the  case  may
be, under Section 14 are inter­alia that the powers are
conferred   specifically   on   these   authorities.   One   of   the
aspects of the power to be exercised is that the District
Magistrate or the Chief Metropolitan Magistrate has to
satisfy himself about compliance of the requirement of
the   Section.   The   satisfaction   is   personal   satisfaction.
The   District   Magistrate   or   the   Chief   Metropolitan
Magistrate   are   conferred   with   the   powers   in   their
specific   capacity   as   Chief   Metropolitan   Magistrate   of
the   District   Magistrate.   They   themselves   only   are   the
competent   authorities   to   exercise   the   powers.   The
nature   of   powers   under   Section   14   would   not   permit
transfer/delegate  of  exercise  of  powers  under  the  said
provision to different person or authorities.”   
 
4.2 It is submitted that while holding as above the Gujarat High
Court   heavily   relied   upon   the   decision   of   this   Court   in   the
case   of   Hari   Chand   Aggarwal   Vs.   Batala   Engineering   Co.
Ltd.   and   Ors.;   (1969)   2   SCR   201 .   It   is   submitted   that   as
held   by   this   Court   in   the   case   of   Hari   Chand   Aggarwal
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(supra)   the   District   Magistrate   and   Additional   District
Magistrate   are   the   distinct   authorities   and   the   Additional
District Magistrate is subordinate to the District Magistrate
and   therefore,   the   Additional   District   Magistrate   being
subordinate   cannot   exercise   the   powers   of   the   District
Magistrate. 
4.3 It   is   submitted   that   the   Gujarat   High   Court   has   also
considered   and   relied   upon   its   earlier   Division   Bench
judgment in the case of  Shivam Water Treaters P. Ltd. Vs.
Authorised   Officer,   State   Bank   of   India   in   Special   Civil
Application   No.   12632   of   2013   decided   on   17.09.2013   by
which   the   Division   Bench   of   the   High   Court   observed   and
held as under: ­ 
“7. In  the  past,  this  very   Bench  had  an  occasion  to
consider   the   question   as   to   whether   the   power
conferred   under   Section   14   of   the   Securitisation   Act
can be delegated by a Chief Metropolitan Magistrate in
favour of the Additional Chief Metropolitan Magistrate.
In that  context,  this bench held that  the action of  the
Chief Metropolitan Magistrate,  Ahmedabad in exercise
of his powers under Section 19 Clause (3) of the Code
of Criminal Procedure, 1973 read with Rule 10 Clause
(1)   of   Chapter   XXXII   of   the   Criminal   Manual,   1977
regarding   the   distribution   of   business   amongst   the
Metropolitan   Magistrates,   Ahmedabad,   thereby
empowering   the   Additional   Chief   Metropolitan
Magistrate, Ahmedabad to accept and decide the cases
under   the   provisions   of   the   Securitisation   Act,   arising
within   the   limits   of   Ahmedabad   Municipal
Corporation, was without jurisdiction. 
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8. In   the   case   before   us,   the   question   is   a   bit
different   one   as   to   whether   a   District   Magistrate   can
delegate such power to the Sub Divisional Magistrate.”
It is submitted that thereafter it is specifically observed
and   held   that   it   is   only   the   District   Magistrate   who   can
exercise the powers under Section 14 of the SARFAESI Act. 
  
4.4 Making   the   above   submissions   and   relying   upon   the
decisions of this Court in the case of   Hari Chand Aggarwal
(supra)   and   the   decisions   of   High   Court   of   Gujarat,   Kerala
and   Calcutta,   it   is   prayed   to   allow   the   present   appeal   and
quash   and   set   aside   the   impugned   judgment   and   order
passed   by   the   High   Court   and   to   hold   that   it   is   only   the
District Magistrate or the Chief Metropolitan Magistrate who
are   conferred   with   the   powers   in   their   specific   capacity   as
Chief   Metropolitan   Magistrate   or   District   Magistrate   to
exercise the powers under Section 14 of the SARFAESI Act.
5. Shri   Sachin   Patil,   learned   counsel   appearing   on   behalf   of
the State has supported the impugned judgment and order
passed by the High Court. It is submitted that looking to the
mandate   under   Section   14   of   the   SARFAESI   Act   to   decide
and   dispose   of   the   applications   under   Section   14   within   a
maximum   period   of   60   days   and   looking   to   the   volume   of
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the   work   and   applications   pending   with   the   District
Magistrates   or   the   Chief   Metropolitan   Magistrates   and   that
they   have   also   to   look   after   and   consider   other   duties
including   the   administrative   work   and   with   a   view   to   see
that   the   ultimate   object   and   purpose   of   providing   the   time
lines   in   deciding   the   applications   under   Section   14   of   the
SARFAESI Act, it is prayed to dismiss the present appeal. 
6. Heard.   While   considering   the   issue   whether   the   Additional
District   Magistrate   or   Additional   Chief   Metropolitan
Magistrate may exercise the powers under Section 14 of the
SARFAESI   Act   and/or   the   issue   whether   the   expression
“District Magistrate” and the “Chief Metropolitan Magistrate”
as appearing in Section 14 of the SARFAESI Act shall deem
to   mean   and   include   Additional   District   Magistrate   and
Additional Chief Metropolitan Magistrate for the purposes of
Section  14  of the  SARFAESI  Act,  the powers exercisable by
the   District   Magistrate   (for   short   “DM”)   and   the   Chief
Metropolitan Magistrate (for short “CMM”) under Section 14
of   the   SARFAESI   Act   are   first   required   to   be   considered.
Section 14 of the SARFAESI Act reads as under: ­ 
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“14.   Chief   Metropolitan   Magistrate   or   District   Magistrate   to
assist secured creditor in taking possession of secured asset.
—(1) Where the possession of any secured assets is required
to  be   taken   by   the   secured  creditor   or   if   any   of   the  secured
assets   is   required   to   be   sold   or   transferred   by   the   secured
creditor under the provisions of this Act, the secured creditor
may,   for   the   purpose   of   taking   possession   or   control   of   any
such   secured   assets,   request,   in   writing,   the   Chief
Metropolitan   Magistrate   or   the   District   Magistrate   within
whose   jurisdiction   any   such   secured   asset   or   other
documents relating thereto may be situated or found, to take
possession thereof, and the Chief Metropolitan Magistrate or
as   the   case   may   be,   the   District   Magistrate   shall,   on   such
request being made to him—
(a) take possession of such asset  and documents relating
thereto; and 
(b)   forward   such   asset   and   documents   to   the   secured
creditor: 
[Provided   that   any   application   by   the   secured   creditor   shall
be   accompanied   by   an   affidavit   duly   affirmed   by   the
authorised officer of the secured creditor, declaring that— 
(i) the aggregate amount of financial assistance granted and
the   total   claim   of   the   Bank   as   on   the   date   of   filing   the
application; 
(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 Financial Institution
is within the limitation period; 
(iii)the   borrower   has   created   security   interest   over   various
properties giving the details of properties referred to in sub­
clause (ii)above; 
(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 non­performing asset; 
(vi) affirming that the period of sixty days notice as required
by the provisions of sub­section (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   non­acceptance   of   such
objection   or   representation   had   been   communicated   to   the
borrower; 
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(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 under the provisions of sub­section (4) of
section 13 read with section 14 of the principal Act; 
(ix)   that   the   provisions   of   this   Act   and   the   rules   made
thereunder had been complied with:
Provided   further   that   on   receipt   of   the   affidavit   from
the   Authorised   Officer,   the   District   Magistrate   or   the   Chief
Metropolitan   Magistrate,   as   the   case   may   be,   shall   after
satisfying   the   contents   of   the   affidavit   pass   suitable   orders
for   the   purpose   of   taking   possession   of   the   secured   assets
[within a period of thirty days from the date of application]
[Provided   also   that   if   no   order   is   passed   by   the   Chief
Metropolitan   Magistrate   or   District   Magistrate   within   the
said period of thirty days for reasons beyond his control, he
may,   after   recording   reasons   in   writing   for   the   same,   pass
the   order   within   such   further   period   but   not   exceeding   in
aggregate sixty days.] 
Provided   also   that   the   requirement   of   filing   affidavit
stated   in   the   first   proviso   shall   not   apply   to   proceeding
pending   before   any   District   Magistrate   or   the   Chief
Metropolitan  Magistrate,  as  the  case  may  be,  on the  date of
commencement of this Act.]
(2)   For   the   purpose   of   securing   compliance   with   the
provisions   of   sub­section   (1),   the   Chief   Metropolitan
Magistrate or the District Magistrate may take or cause to be
taken   such   steps   and   use,   or   cause   to  be   used,   such   force,
as may, in his opinion, be necessary. 
(3)   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   this   section   shall   be   called   in   question   in  any
court or before any authority.”
6.1 That in the year 2013 by Act 1 of 2013, Section 14 (1A) has
been   inserted   by   which   now,   while   exercising   the   powers
under   Section   14   of   the   SARFAESI   Act,   the   District
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Magistrate   or   the   Chief   Metropolitan   Magistrate   may
authorise any officer subordinate to him to take possession
of   such   assets   and   documents   relating   thereto;   and   to
forward such assets and documents to the secured creditor.
Section   14   (1A)   as   inserted   in   the   year   2013   reads   as
under:­
“[(1A) The District Magistrate or the Chief Metropolitan
Magistrate may authorise any officer subordinate to him,— 
(i)to   take   possession   of   such   assets   and   documents
relating thereto; and 
(ii)   to   forward   such   assets   and   documents   to   the
secured creditor.]” 
6.2 Even   as   observed   and   held   by   this   Court   in   the   recent
decision   of   NKGSB   Cooperative   Bank   Limited   Vs.   Subir
Chakravarty   &   Ors.   (Civil   Appeal   No.   1637/2022)   decided
on   25.02.2022,   it   is   open   to   the   CMM/DM   to   appoint   an
advocate   and   authorise   him/her   to   take   possession   of   the
secured   assets   and   documents   relating   thereto   and   to
forward   the   same   to   the   secured   creditor   under   Section
14(1A) of the SARFAESI Act. 
7. Now   so   far   as   the   powers   exercisable   by   DM   and   CMM
under   Section   14   of   the   SARFAESI   Act   are   concerned,
statement   of   objects   and   reasons   for   which   SARFAESI   Act
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has been enacted reads as under: ­
“STATEMENT OF OBJECTS AND REASONS 
The financial sector has been one of the key drivers in India's
efforts to achieve success in rapidly developing  its economy.
While   the   banking   industry   in   India   is   progressively
complying   with   the   international   prudential   norms   and
accounting   practices   there   are   certain   areas   in   which   the
banking and financial sector do not have a level playing field
as compared to other participants in the financial markets in
the   world.   There   is   no   legal   provision   for   facilitating
securitisation   of   financial   assets   of   banks   and   financial
institutions.   Further,   unlike   international   banks,   the   banks
and financial institutions in India do not have power to take
possession   of   securities   and   sell   them.   Our   existing   legal
framework relating  to commercial  transactions  has  not kept
pace   with   the   changing   commercial   practices   and   financial
sector reforms. This has resulted in slow pace of recovery of
defaulting   loans   and   mounting   levels   of   non­performing
assets   of   banks   and   financial   institutions.   Narasimham
Committee I and II and Andhyarujina Committee constituted
by   the   Central   Government   for   the   purpose   of   examining
banking sector reforms have considered the need for changes
in   the   legal   system   in   respect   of   these   areas.   These
Committees,   inter   alia,   have   suggested   enactment   of   a   new
legislation   for   securitisation   and   empowering   banks   and
financial institutions to take possession of the securities and
to sell them  without the intervention of the court. Acting on
these   suggestions,   the   Securitisation   and   Reconstruction   of
Financial   Assets   and   Enforcement   of   Security   Interest
Ordinance, 2002 was promulgated on the 21st June, 2002 to
regulate securitisation and reconstruction of financial assets
and   enforcement   of   security   interest   and   for   matters
connected   therewith   or   incidental   thereto.   The   provisions   of
the Ordinance would enable banks and financial institutions
to   realise   long­term   assets,   manage   problem   of   liquidity,
asset   liability   mismatches   and   improve   recovery   by
exercising powers to take possession of securities, sell them
and   reduce   nonperforming   assets   by   adopting   measures   for
recovery or reconstruction.”   
Thus,   the   underlying   purpose   of   the   SARFAESI   Act   is
to   empower   the   financial   institutions   in   India   to   have
16

similar   powers   as   enjoyed   by   their   counterparts,   namely,
international banks in other  countries. One such feature is
to   empower   the   financial   institutions   to   take   possession   of
securities and sell them. The same has been translated into
provisions   falling   under   Chapter   III   of   the   SARFAESI   Act.
Section 13 deals with enforcement of security interest. Sub­
Section   (4)   thereof   envisages   that   in   the   event   a   default   is
committed by the borrower in discharging his liability in full
within   the   period   specified   in   sub­section   (2),   the   secured
creditor  may  take recourse to  one or  more of  the  measures
provided  in   sub­section   (4).  One  of  the   measures  is  to  take
possession   of   the   secured   assets   of   the   borrower   including
the right to transfer by way of lease, assignment or sale for
realising   the   secured   asset.   That,   they   could   do   through
their   “authorised   officer”   as   defined   in   Rule   2(a)   of   the
Security Interest (Enforcement) Rules, 2002.
7.1 After   taking   over   possession   of   the   secured   assets,   further
steps  to  lease, assign  or  sale  the  same  could  also  be  taken
by   the   secured   creditor.   However,   Section   14   of   the
SARFAESI   Act   predicates   that   if   the   secured   creditor
intends   to   take   possession   of   the   secured   assets,   must
17

approach the CMM/DM by way of an application in writing,
and   on   receipt   of   such   request,   the   CMM/DM   must   move
into action in right earnest. After passing an order thereon,
he/she   (CMM/DM)   must   proceed   to   take   possession   of   the
secured   assets   and   documents   relating   thereto   for   being
forwarded   to   the   secured   creditor   in   terms   of   Section   14(1)
read   with   Section   14(2)   of   the   SARFAESI   Act.   As   noted
earlier,   Section   14(2)   is   an   enabling   provision   and   permits
the CMM/DM to take such steps and use force, as may, in
his opinion, be necessary.
7.2 At   this   stage,   it   is   required   to   be   noted   that   along   with
insertion   of   sub­section   (1A),   a   proviso   has   also   been
inserted   in   sub­section   (1)   of   Section   14   of   the   SARFAESI
Act whereby the secured creditor is now required to comply
certain   conditions   and   to   disclose   that   by   way   of   an
application   accompanied   by   affidavit   duly   affirmed   by   its
authorised officer  in that  regard. Sub­Section (1A) is in the
nature   of   an   explanatory   provision   and   it   merely   restates
the implicit power of the CMM/DM in taking services of any
officer   subordinate   to   him.   As   observed   and   held   by   this
Court   in   the   case   of   NKGSB   Cooperative   Bank   Ltd.
18

(supra),   the   insertion   of   sub­section   (1A)   is   not   to   invest   a
new power for the first time in the CMM/DM as such. 
8. Thus,   considering   the   scheme   of   the   SARFAESI   Act,   it   is
explicit   and   crystal   clear   that   possession   of   the   secured
assets   can   be   taken   by   the   secured   creditor   before
confirmation   of   sale   of   the   secured   assets   as   well   as   post­
confirmation   of   sale.   For   taking   possession   of   the   secured
assets,   it   could   be   done   by   the   “authorised   officer”   of   the
Bank   as   noted   in   Rule   8   of   the   Security   Interest
(Enforcement) Rules, 2002. 
8.1 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
19

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   secured   assets   and   documents
relating   thereto   and   to   forward   the   same   to   the   secured
creditor at the earliest opportunity. As mandated by Section
14 of the SARFAESI Act, the CMM/DM has to act within the
stipulated   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
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.
As   observed   and   held   by   this   Court   in   the   case   of   NKGSB
Cooperative   Bank   Ltd.   (supra),   the   step   taken   by   the
CMM/DM while taking possession of the secured assets and
documents relating thereto is a ministerial step. It 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
20

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   quasi­judicial   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.    
9. Thus,   in   view   of   the   scheme   of   the   SARFAESI   Act,   more
particularly, Section 14 of the SARFAESI Act and the nature
of the powers to be exercised by learned Chief Metropolitan
Magistrate/learned   District   Magistrate,   the   High   Court   in
the impugned judgment and order has rightly observed and
held that the power vested in the learned Chief Metropolitan
Magistrate/learned   District   Magistrate   is   not   by   way   of
persona designata.   
21

10. Now   the   next   question   which   is   posed   for   consideration   of
this   Court   is,   whether,   the   Additional   Chief   Metropolitan
Magistrate   can   be   said   to   be   subordinate   to   the   Chief
Metropolitan   Magistrate.   For   that   purpose   the   relevant
provisions of the Cr.PC, namely, Sections 11, 12, 15, 16, 17,
19 and 35, are required to be referred to which are extracted
as under:­ 
“11. Courts of Judicial Magistrates.—(1) In every district (not
being   a   metropolitan   area)   there   shall   be   established   as
many Courts of Judicial Magistrates of the first class and of
the   second   class,   and   at   such   places,   as   the   State
Government may, after consultation with the High Court, by
notification,   specify:   1   [Provided   that   the   State   Government
may,   after   consultation   with   the   High   Court,   establish,   for
any   local   area,   one   or   more   Special   Courts   of   Judicial
Magistrates of the first class or of the second class to try any
particular   case   or   particular   class   of   cases,   and   where   any
such   Special   Court   is   established,   no   other   Court   of
Magistrate in the local area shall have jurisdiction to try any
case   or   class   of   cases   for   the   trial   of   which   such   Special
Court   of   Judicial   Magistrate   has   been   established.]   (2)   The
presiding   officers   of   such   Courts   shall   be   appointed   by   the
High Court. (3) The High Court may, whenever it appears to
it   to   be   expedient   or   necessary,   confer   the   powers   of   a
Judicial Magistrate of the first class or of the second class on
any member of the Judicial Service of the State, functioning
as a Judge in a Civil Court.
12.   Chief   Judicial   Magistrate   and   Additional   Chief   Judicial
Magistrate,   etc.—(1)   In   every   district   (not   being   a
metropolitan   area),   the   High   Court   shall   appoint   a   Judicial
Magistrate   of   the   first   class   to   be   the   Chief   Judicial
Magistrate.   (2)   The   High   Court   may   appoint   any   Judicial
Magistrate of the first class to be an Additional Chief Judicial
Magistrate, and such Magistrate shall have all or any of the
powers   of   a   Chief   Judicial   Magistrate   under   this   Code   or
under   any   other   law   for   the   time   being   in   force  as   the  High
22

Court   may   direct.  (3)   (a)  The  High  Court   may   designate  any
Judicial   Magistrate   of   the   first   class   in   any   sub­division   as
the Sub­divisional Judicial Magistrate and relieve him of the
responsibilities specified in this section as occasion requires.
(b)   Subject   to   the   general   control   of   the   Chief   Judicial
Magistrate,   every   Sub­divisional   Judicial   Magistrate   shall
also   have   and   exercise,   such   powers   of   supervision   and
control over the work of the Judicial Magistrates (other than
Additional  Chief  Judicial Magistrates)  in  the  sub­division  as
the   High   Court   may,   by   general   or   special   order,   specify   in
this behalf.
15.   Subordination   of   Judicial   Magistrates.—(1)   Every   Chief
Judicial   Magistrate   shall   be   subordinate   to   the   Sessions
Judge;   and   every   other   Judicial   Magistrate   shall,   subject   to
the general control of the Sessions Judge, be subordinate to
the   Chief   Judicial   Magistrate.   (2)   The   Chief   Judicial
Magistrate may, from time to time, make rules or give special
orders,   consistent   with   this   Code,   as   to   the   distribution   of
business   among   the   Judicial   Magistrates   subordinate   to
him.
16.   Courts   of   Metropolitan   Magistrates.—(1)   In   every
metropolitan area, there shall be established as many Courts
of Metropolitan Magistrates, and at such places, as the State
Government may, after consultation with the High Court, by
notification, specify. (2) The presiding officers of such Courts
shall   be   appointed   by   the   High   Court.   (3)   The   jurisdiction
and   powers   of   every   Metropolitan   Magistrate   shall   extend
throughout the metropolitan area.
17.   Chief   Metropolitan   Magistrate   and   Additional   Chief
Metropolitan   Magistrate.—(1)   The   High   Court   shall,   in
relation   to   every   metropolitan   area   within   its   local
jurisdiction,   appoint   a   Metropolitan   Magistrate   to   be   the
Chief Metropolitan Magistrate for such metropolitan area. (2)
The High Court may appoint any Metropolitan Magistrate to
be   an   Additional   Chief   Metropolitan   Magistrate,   and   such
Magistrate   shall   have   all   or   any   of   the   powers   of   a   Chief
Metropolitan Magistrate under this Code or under any other
law for the time being in force as the High Court may direct.
19.   Subordination   of   Metropolitan   Magistrates.—(1)   The
Chief   Metropolitan   Magistrate   and   every   Additional   Chief
Metropolitan Magistrate shall be subordinate to the Sessions
Judge;   and   every   other   Metropolitan   Magistrate   shall,
subject   to   the   general   control   of   the   Sessions   Judge,   be
subordinate   to   the   Chief   Metropolitan   Magistrate.   (2)   The
23

High   Court   may,   for   the   purposes   of   this   Code,   define   the
extent   of   the   subordination,   if   any,   of   the   Additional   Chief
Metropolitan   Magistrates   to   the   Chief   Metropolitan
Magistrate.  (3)  The  Chief  Metropolitan  Magistrate  may, from
time   to   time,   make   rules   or   give   special   orders,   consistent
with this Code, as to the distribution of business among the
Metropolitan Magistrates and as to the allocation of business
to an Additional Chief Metropolitan Magistrate.
35.   Powers   of   Judges   and   Magistrates   exercisable   by   their
successors­in­office.—(1)   Subject   to   the   other   provisions   of
this   Code,   the   powers   and   duties   of   a   Judge   or   Magistrate
may be exercised or performed by his successor­in­office. (2)
When there is any doubt as to who is the successor­in­office
of   any   Additional   or   Assistant   Sessions   Judge,   the  Sessions
Judge   shall   determine   by   order   in   writing   the   Judge   who
shall, for the purposes of this Code or of any proceedings or
order thereunder, be deemed to be the successor­in­office of
such Additional or Assistant Sessions Judge. (3) When there
is   any   doubt   as   to   who   is   the   successor­in­office   of   any
Magistrate,   the   Chief   Judicial   Magistrate,   or   the   District
Magistrate,   as  the  case   may   be,  shall  determine  by   order   in
writing   the   Magistrate   who   shall,   for   the   purpose   of   this
Code   or   of   any   proceedings   or   order   thereunder,   be   deemed
to be the successor­in­office of such Magistrate.”
10.1 From   the   aforesaid   provisions,   it   can   be   seen   that   any
Metropolitan Magistrate can be appointed by the High Court
to   be   the   Chief   Metropolitan   Magistrate.   The   High   Court
may   appoint   any   Metropolitan   Magistrate   to   be   an
Additional   Chief   Metropolitan   Magistrate,   and   such
Magistrate   shall   have   all   or   any   of   the   powers   of   a   Chief
Metropolitan Magistrate under Cr.PC or under any other law
for the time being in force as the High Court may direct. The
Chief   Metropolitan   Magistrate   and   every   Additional   Chief
24

Metropolitan   Magistrate   shall   be   subordinate   to   the
Sessions   Judge;   and   every   other   Metropolitan   Magistrate
shall,   subject   to   the   general   control   of   the   Sessions   Judge,
be   subordinate   to   the   Chief   Metropolitan   Magistrate.   Thus
the judicial powers and the powers, under the Cr.PC which
may be exercised by the Chief Metropolitan Magistrate, can
be exercised by the Additional Chief Metropolitan Magistrate
also. Thus, the Additional Chief Metropolitan Magistrate can
be said to be at  par  with  the Chief Metropolitan Magistrate
in so far as the powers to be exercised under the Cr.PC are
concerned.   The   Chief   Metropolitan   Magistrate   in   addition,
may   have   administrative   powers.   However,   for   all   other
purposes   and   more   particularly   the   powers   to   be   exercised
under   the   Cr.PC   both   are   at   par.   Therefore,   the   Additional
Chief   Metropolitan   Magistrate   cannot   be   said   to   be
subordinate to the Chief Metropolitan Magistrate in so far as
exercise of judicial powers are concerned.   
10.2 In view of the above discussion and as observed hereinabove
when   the   powers   to   be   exercised   by   the   Additional   Chief
Metropolitan   Magistrate   are   at   par   with   the   powers   to   be
exercised   by   the   Chief   Metropolitan   Magistrate   [Section
25

17(2)   of   Cr.PC]   and   the   Chief   Metropolitan   Magistrate   and
Additional   Chief   Metropolitan   Magistrate   shall   be
subordinate to the Sessions Judge (Section 19 of the Cr.PC)
and   the   steps   to   be   taken   by   the   Chief   Metropolitan
Magistrate   under   Section   14   of   the   SARFAESI   Act   as
observed hereinabove are ministerial in nature and does not
involve any adjudicatory process and there is no element of
any   quasi­judicial   function,   we   see   no   reason   to   take   a
different   view   than   the   view   taken   by   the   Bombay   High
Court   in   the   impugned   judgment.   We   hold   that   the
expression   “Chief   Metropolitan   Magistrate”   as   appearing   in
Section   14   of   the   SARFAESI   Act   shall   deem   to   mean   and
include   Additional   Chief   Metropolitan   Magistrate   for   the
purposes of Section 14 of the SARFAESI Act.          
10.3 Similarly,   when   the   Additional   District   Magistrates   are
conferred   with   the   powers   to   be   exercised   by   the   District
Magistrates   either   by   delegation   and/or   by   special   orders
and   the   Additional   District   Magistrates   are   exercising   the
same   powers   which   are   being   exercised   by   the   District
Magistrates,   the   same   analogy   can   be   applied,   more
26

particularly, when the powers exercisable under Section 14
of the SARFAESI Act, are ministerial steps. 
11. The   issue/question   may   also   be   considered   from   another
angle. It cannot be disputed and even judicial notice can be
taken   of   the   fact   that   the   CMMs   and/or   even   the   DMs   are
required   to   perform   so   many   other   duties   under   different
statutes.   They   have   to   perform   many   administrative   duties
also. District Magisters are in overall administrative control
of   their   jurisdiction/district.   Similarly,   CMMs   are   also
required   to   perform   administrative   duties   and   they   have
also   to   deal   with   the   other   cases/criminal   trials   and   many
trials under special statutes also. It cannot be disputed that
the   litigations   under   the   SARFAESI   Act   and   proceedings
and/or  applications under  Section  14 of the  SARFAESI  Act
are   increasing.   Even   as   noticed   by   the   High   Court   in   the
impugned judgment and order, as on 09.08.2017, 926 cases
were pending under Section 14 of the SARFAESI Act before
only   one   CMM.   Therefore,   a   number   of   applications   under
Section 14 are pending. It also cannot be disputed that the
SARFAESI   Act   provides   for   expeditious   disposal   of   the
applications filed under Section 14 of the SARFAESI Act. As
27

per,   second   proviso   to   Section   14,   suitable   orders   for   the
purpose   of   taking   possession   of   the   secured   assets   are
required   to   be   passed   within   a   maximum   period   of   sixty
days   from   the   date   of   the   application.   Therefore,   if   the
submission   on   behalf   of   the   appellants   that   only   the
concerned CMM/DM alone would have jurisdiction to decide
the   applications   under   Section   14   of   the   SARFAESI   Act   is
accepted,   in   that   case,   it   will   be   practically   impossible   for
the   concerned   CMM/DM   to   decide   the   application   under
Section   14   of   the   SARFAESI   Act   expeditiously   and   within
the   time   stipulated   under   second   proviso   to   Section   14   of
the   SARFAESI   Act.   If   the   interpretation   which   we   propose
that,   the   District   Magistrate/Chief   Metropolitan   Magistrate
under   Section   14   of   the   SARFAESI   Act   includes   the
Additional District Magistrate/Additional Chief Metropolitan
Magistrate,   the   same   can   be   said   to   be   a   purposive
interpretation   to   achieve   the   object   and   purpose   of
proceedings   under   the   SARFAESI   Act,   more   particularly
when   as   observed   hereinabove,   the   orders   to   be   passed
under Section 14 of the SARFAESI Act are ministerial steps
and   to   assist   the   secured   creditor   in   getting/obtaining   the
28

possession   of   the   secured   property.   Thus,   there   is   no
element of exercise of adjudicatory powers under Section 14
of   the   SARFAESI   Act.   All   these   aspects   have   been
considered   in   detail   by   the   High   Court   in   the   impugned
judgment and order. 
12. We   are   in   complete   agreement   with   the   view   taken   by   the
High   Court   that   (i)   the   District   Magistrate,   Chief
Metropolitan   Magistrate   is   not   a   persona   designata   for   the
purposes   of   Section   14   of   the   SARFAESI   Act;   (ii)   the
expression “District Magistrate” and the “Chief Metropolitan
Magistrate” as appearing in Section 14 of the SARFAESI Act
shall   deem   to   mean   and   include   Additional   District
Magistrate and Additional Chief Metropolitan Magistrate for
the purposes of Section 14 of the SARFAESI Act. 
13. The contrary  view  taken  by  the other  High Courts, namely,
Gujarat High Court in the case of Pushpa Devi B Jain W/o
Bhawarlal M Jain Vs. Indian Overseas Bank in Special Civil
Application   No.   19102/2015;   Calcutta   High   Court   in   the
case   of   Shri   Chellaperumal   &   Anr.   Vs.   The   Authorised
Officer   &  Ors.  in   M.A.  No.  26/2014   and  Kerala  High   Court
in   the   case   of   Aseena   Vs.   Sub­Divisional   Magistrate   and
29

Ors.  in   W.P.  (C)   No.  3331/2007,   is  not   a   good  law   and   are
specifically overruled.           
14. In   view   of   the   above   and   for   the   reasons   stated   above,   the
present appeal fails and the same deserves to be dismissed
and   is   accordingly   dismissed.   We   hold   that   the   powers
under  Section 14 of  the SARFAESI  Act can be exercised by
the   concerned   Additional   Chief   Metropolitan   Magistrates   of
the   area   having   jurisdiction   and   also   by   the   Additional
District   Magistrates,   who   otherwise   are   exercising   the
powers at par with the concerned District Magistrates either
by   delegation   and/or   special   order.   The   present   appeal   is
accordingly dismissed. No costs.    
………………………………….J.
[M.R. SHAH]
NEW DELHI; ………………………………….J.
July 27, 2022 [B.V. NAGARATHNA]
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