SOUTH INDIAN BANK LTD Vs. JAHFER M.

JUDGEMENT

(1.) The first petitioner in this Original Petition (DRT) is a banking Company registered under the Companies Act, of 1913 and the 2nd petitioner is one of the Authorized Officers of the first petitioner under the provisions of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (hereinafter referred to as the SARFAESI Act). The petitioners are before this Court challenging Ext.P6 order of the Debts Recovery Tribunal-I, Ernakulam (hereinafter referred to as the Tribunal) in S.A.No.286/2024. Through the said order the Tribunal set aside an order of the Chief Judicial Magistrate, Manjeri in M.C.No.929/2023 on the file of that Court, on the ground that the said order was passed without due application of mind and in a printed format. The contention that the properties in question are agricultural lands was rejected by the Tribunal.

(2.) Sri. K.K. Chandran Pillai, the learned senior counsel appearing for the petitioners on the instructions of Adv. P. A. Augustine would contend that the Chief Judicial Magistrate is not an Adjudicating Authority under the provisions of the SARFAESI Act. It is submitted that, while exercising powers under Sec. 14 of the SARFAESI Act, the Chief Judicial Magistrate only exercises an administrative power as it is clear from a reading of the provisions of Sec. 14 of the SARFAESI Act that the duty of the learned Magistrate is only to assist the secured creditor in taking possession of the secured asset. The learned senior counsel referred to the judgments of the Supreme Court in Indian Bank v. D. Visalakshi; (2019) 20 SCC 47, R.D. Jain & Co. v. Capital First Ltd., (2023) 1 SCC 675 and Balkrishna Rama Tarle v. Phoenix ARC (P) Ltd.; (2023) 1 SCC 662 and also to the judgment of this Court in Canara Bank Ltd. v. Stephen John and others; 2018 (3) KHC 670 in support of his contention that the Chief Judicial Magistrate exercising powers under Sec. 14 of the SARFAESI Act is only exercising a ministerial power and is not exercising a judicial power. It is submitted that, in such circumstances, the act of the Tribunal in interfering with the order of the learned Chief Judicial Magistrate, Manjeri in M.C.No.929/2023 is clearly unsustainable as the order was set aside only on the ground that it was issued in a printed format.

(3.) Sri. V. Philip Mathews, the learned counsel appearing for the respondent (applicant in S.A.No.286/2024 before the Tribunal) vehemently contends that the order of the Tribunal is correct in law and ought to be sustained by this Court. It is submitted that there is no jurisdictional error or other defect in Ext.P6 order warranting interference at the hands of this Court in an Original Petition under Art.227 of the Constitution of India. It is submitted that, if the petitioners are in any manner aggrieved by Ext.P6 order, they have to challenge it before the Debts Recovery Appellate Tribunal instead of approaching this Court in an Original Petition under Art.227 of the Constitution of India. The learned counsel places reliance on the judgment of the Supreme Court in Visalakshi (supra) and contends that the enquiry by a Magistrate under Sec. 14 is a quasi-judicial enquiry through a nonjudicial process. It is submitted that this Court in the judgment in Sama Rubbers v. South Indian Bank Ltd.; 2023 KLT OnLine 1955 has held that the Chief Judicial Magistrate must display a judicial approach in considering the relevant facts asserted by the parties. It is submitted that, when faced with an application under Sec. 14 of the SARFAESI Act, the learned Magistrate is not expected to adjudicate any lis, the learned Magistrate ought to satisfy himself that all the conditions for the exercise of the power under Sec. 14 of the SARFAESI Act have been satisfied in the particular case before him. It is submitted that this Court in the judgment in Jimmy Thomas v. Indian Bank; 2023 (3) KLT 630 has deprecated the practice of the Tribunal adopting a 'cut, copy, paste' method in passing interim orders on Securitisation Applications. It is submitted that on the same principle, the order of the Chief Judicial Magistrate which was set aside by the Tribunal in S.A.No.286/2024 cannot be justified in law. It is submitted that the exercise of power under Sec. 14 of the SARFAESI Act results in drastic circumstances and therefore, a casual approach to the passing of orders on applications filed under Sec. 14 of the SARFAESI Act cannot be justified in any manner. It is therefore submitted that the order of the Tribunal is to be upheld.