BALKRISHNA RAMA TARLE DEAD THR LRS & ANR versus PHOENIX ARC PRIVATE LIMITED & ORS

BALKRISHNA RAMA TARLE DEAD THR LRS & ANR versus PHOENIX ARC PRIVATE LIMITED & ORS

The Supreme Court upheld the High Court: Section 14 confers ministerial powers on the CMM/DM to assist a secured creditor in taking possession once the statutory affidavit/formalities are satisfied; the designated authority is not to adjudicate tenancy or related disputes in Section 14 proceedings and cannot keep an application pending until the secured creditor evicts tenants by separate proceedings; such disputes should be raised before the DRT under Section 17.

Parties
Petitioner: Balkrishna Rama Tarle Dead thr Lrs & Anr.; Respondent: Phoenix ARC Private Limited; Respondent: District Magistrate, Nashik (Designated Authority)
Jurisdiction
India
Judgment Date
26 September 2022
Procedural Posture
Special Leave Petition / Appeal to Supreme Court Against High Court Judgment Dated 03.08.2022
Outcome
Special Leave Petition dismissed; High Court judgment and order dated 03.08.2022 upheld
Legal Topics
Section 14 SARFAESI Act, Powers of District Magistrate/chief Metropolitan Magistrate, Possession of Secured Assets, Eviction and Tenancy, Section 17 SARFAESI Act / DRT Jurisdiction
Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 Administrative Law Landlord and Tenant Law Section 14 SARFAESI Act Powers of District Magistrate/chief Metropolitan Magistrate Possession of Secured Assets Eviction and Tenancy Section 17 SARFAESI Act / DRT Jurisdiction

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Parties

Balkrishna Rama Tarle Dead thr Lrs & Anr.

Petitioner

Phoenix ARC Private Limited

Respondent

District Magistrate, Nashik (Designated Authority)

Respondent

Procedural Posture

Special Leave Petition / Appeal to Supreme Court Against High Court Judgment Dated 03.08.2022

Legal Issues

  1. 1 Whether a Chief Metropolitan Magistrate/District Magistrate (designated authority) may decline to assist a secured creditor under Section 14 until the secured creditor terminates tenancy rights by separate eviction proceedings
  2. 2 Scope and nature of powers exercisable by the CMM/DM under Section 14 of the SARFAESI Act
  3. 3 Whether the designated authority is required to adjudicate tenancy or other disputes between third parties and the secured creditor when deciding an application under Section 14

Ratio Decidendi

The Supreme Court upheld the High Court: Section 14 confers ministerial powers on the CMM/DM to assist a secured creditor in taking possession once the statutory affidavit/formalities are satisfied; the designated authority is not to adjudicate tenancy or related disputes in Section 14 proceedings and cannot keep an application pending until the secured creditor evicts tenants by separate proceedings; such disputes should be raised before the DRT under Section 17.

Court Disposition

Special Leave Petition dismissed; High Court judgment and order dated 03.08.2022 upheld

Orders

  • Special Leave Petition No.16013 of 2022 dismissed
  • High Court order dated 03.08.2022 upheld directing the designated authority/District Magistrate to hear and dispose of the application under Section 14 of the SARFAESI Act in accordance with law