Smt. Dipali Roy vs The State of West Bengal and Others

Joymalya Bagchi, J.—The writ petitioner had purchased a mini bus under a hypothecation agreement with respondent no. 4/bank. The writ petitioner defaulted in making payments with regard to the loan agreement and proceedings were initiated under sub-section (2) of Section 13 of the Securitizations and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (hereinafter referred to as "SARFAESI Act"). The writ petitioner had preferred an earlier writ petition being W.P. 16554(W) of 2011, which was disposed of by a learned Single Judge of this Court directing a copy of the loan agreement be handed over to the petitioner. Such order appears to have been complied with. The petitioner was subsequently served with a notice dated 24th July, 2012 purportedly under sub-section (2) of Section 14 of the SARFAESI Act, wherein the District Magistrate had directed the Commissioner of Police, Asansol-Durgapur Commissionerate, the respondent no. 5 herein, to give police assistance to the Authorized Officer/Branch Manager, State Bank of India, the respondent no. 3 herein, to take possession of the secured asset, namely, the bus, which had been purchased by the petitioner under the hypothecation agreement.

Learned counsel appearing on behalf of the petitioner submits that under the provisions of Section 14 of the SARFAESI Act, the District Magistrate ought to have taken possession of the secured assets by himself. Direction of police assistance to the authorized officer of the bank, who is a public servant, was beyond the scope of the said section.

Learned counsel appearing on behalf of the bank submits that the District Magistrate has incidental/ancillary powers to effectuate the exercise of his authority under the aforesaid law as provided in sub-section (2) of Section 14 of the said Act.

I am of the considered view that u/s 14 of the SARFAESI Act, it is incumbent upon the District Magistrate through his own office to take possession of the secured assets and thereafter hand it over to the secured credit.

Accordingly, I set aside the impugned order dated 24th July, 2012, whereby the District Magistrate had directed police assistance to the authorized officer of the respondent/bank to take possession. Learned counsel for the respondent/bank has expressed apprehension that the secured assets may be removed in the meantime.

I further direct the District Magistrate to forthwith take action u/s 14 of the SARFAESI Act and take possession of the secured assets within thirty (30) days from date. The District Magistrate would be at liberty to take necessary police assistance in discharge of his duty, if necessary. The petitioner shall also render all necessary assistance in discharge of such public duty by the District Magistrate in accordance with law.

With the aforesaid direction, the writ petition is disposed of.

The respondents having not been called upon to file any affidavit, the allegations leveled against them shall not be deemed to be admitted.

Urgent photostat certified copy of this order, if applied for, be supplied on priority basis.