M/S R. D. JAIN AND CO. versus CAPITAL FIRST LTD. & ORS.

M/S R. D. JAIN AND CO. versus CAPITAL FIRST LTD. & ORS.

The Supreme Court held that (i) the expression "Chief Metropolitan Magistrate" and "District Magistrate" in Section 14 of the SARFAESI Act shall be deemed to include Additional Chief Metropolitan Magistrate and Additional District Magistrate for purposes of s.14; (ii) the powers under s.14 are ministerial/executionary and do not involve adjudicatory or quasi-judicial functions, and therefore may be exercised by Additional Magistrates or delegated to subordinate officers to meet statutory timelines; contrary High Court decisions (Gujarat, Calcutta, Kerala) were overruled.

Parties
Appellant (borrower): M/s R. D. Jain and Co.; Respondent (secured Creditor): Capital First Ltd. & Ors.
Jurisdiction
India
Judgment Date
27 July 2022
Procedural Posture
Civil Appeal / On Appeal From Judgment and Order Dated 22.12.2017 of the High Court of Judicature at Bombay in Writ Petition No. 1961 of 2017
Outcome
Appeal dismissed.
Legal Topics
Section 14 Interpretation, Persona Designata, Delegation to Additional District Magistrate/additional Chief Metropolitan Magistrate, Ministerial V. Quasi Judicial Function, Time Limits for Enforcement Actions
Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 Code of Criminal Procedure, 1973 Security Interest (enforcement) Rules, 2002 Section 14 Interpretation Persona Designata Delegation to Additional District Magistrate/additional Chief Metropolitan Magistrate Ministerial V. Quasi Judicial Function Time Limits for Enforcement Actions

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Parties

M/s R. D. Jain and Co.

Appellant (borrower)

Capital First Ltd. & Ors.

Respondent (secured Creditor)

Procedural Posture

Civil Appeal / On Appeal From Judgment and Order Dated 22.12.2017 of the High Court of Judicature at Bombay in Writ Petition No. 1961 of 2017

Legal Issues

  1. 1 Whether the expression "Chief Metropolitan Magistrate" and "District Magistrate" in Section 14 of the SARFAESI Act includes Additional Chief Metropolitan Magistrate and Additional District Magistrate respectively
  2. 2 Whether the District Magistrate/Chief Metropolitan Magistrate under Section 14 of the SARFAESI Act is a persona designata
  3. 3 Whether the powers under Section 14 of the SARFAESI Act are ministerial or quasi-judicial and thus delegable

Ratio Decidendi

The Supreme Court held that (i) the expression "Chief Metropolitan Magistrate" and "District Magistrate" in Section 14 of the SARFAESI Act shall be deemed to include Additional Chief Metropolitan Magistrate and Additional District Magistrate for purposes of s.14; (ii) the powers under s.14 are ministerial/executionary and do not involve adjudicatory or quasi-judicial functions, and therefore may be exercised by Additional Magistrates or delegated to subordinate officers to meet statutory timelines; contrary High Court decisions (Gujarat, Calcutta, Kerala) were overruled.

Court Disposition

Appeal dismissed.

Orders

  • Appeal dismissed
  • The expression "District Magistrate" and "Chief Metropolitan Magistrate" in Section 14 of the SARFAESI Act shall deem to include Additional District Magistrate and Additional Chief Metropolitan Magistrate for the purposes of Section 14