District Administration Must Execute Section 14 SARFAESI Possession Orders Within One Month, Subject to Legal Impediments.

The petitioner-bank had advanced loan facilities to Madan Pal and Neeru Pal against a secured immovable property. Following default, the loan account was classified as a non-performing asset and proceedings were initiated under the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (“SARFAESI Act”).

The bank applied under Section 14 of the SARFAESI Act before the Chief Judicial Magistrate, Gwalior, seeking assistance for obtaining physical possession of the secured asset. By order dated 10 October 2025 in M.J.C.R. No. 3899/2025, the Chief Judicial Magistrate allowed the application and directed that possession be obtained and handed over to the bank.

Despite the order, physical possession was not delivered. The Tehsildar constituted a team by order dated 23 July 2026 and fixed 4 August 2026 for taking possession, but the exercise was unsuccessful.

The bank therefore invoked Article 226 of the Constitution and sought directions requiring the District Administration to execute the Section 14 order and deliver physical possession of the secured asset.

Whether the High Court should direct the District Administration and the concerned Tehsildar to execute the Chief Judicial Magistrate’s order under Section 14 of the SARFAESI Act and deliver physical possession of the secured asset to the petitioner-bank?

Whether execution of the Section 14 order was subject to any subsisting stay or other legal impediment issued by a competent Court or Tribunal?

The Court applied Article 226 of the Constitution of India, under which the High Court may issue appropriate directions to public authorities to secure lawful performance of statutory duties.

Section 14 of the SARFAESI Act authorises the Chief Judicial Magistrate or District Magistrate to assist a secured creditor in obtaining possession of secured assets.

The Court relied on the directions issued in IIFL Home Finance Ltd. v. State of M.P. & Others, W.P. No. 2078/2023, requiring the District Administration/Collector to ensure timely and expeditious execution of orders under Section 14, and on the subsequent decision in W.P. No. 41410/2025, decided on 29 October 2025, which reiterated those directions in a similar case.

The Court also recognised that action under Section 14 may be deferred where a competent Court or the Debt Recovery Tribunal has passed a subsisting interim order restraining or staying SARFAESI proceedings.

The Chief Judicial Magistrate had already allowed the bank’s Section 14 application and issued operative directions for taking possession of the secured asset.

The bank specifically asserted that no order of any Court, forum, or the Debt Recovery Tribunal restraining execution had been brought to its notice.

Since the administrative authorities had failed to complete possession despite the order and the Tehsildar’s subsequent attempt, the Court held that the District Administration was required to ensure expeditious implementation of the existing judicial direction.

Applying the time-bound execution framework laid down in IIFL Home Finance and reiterated in W.P. No. 41410/2025, the Court directed the Collector and the concerned Tehsildar to complete the process, while expressly making the direction subject to the absence of any subsisting stay or other legal impediment.

The Court clarified that it was not examining the merits of the underlying SARFAESI proceedings.

The concerned Tehsildar/competent authority was directed to take all necessary steps to execute the Chief Judicial Magistrate’s order dated 10 October 2025 and obtain and hand over physical possession of the secured asset to the petitioner-bank within one month from receipt of a certified copy of the High Court’s order, subject to there being no subsisting stay or other legal impediment from a competent Court or Tribunal.

The Court expressed no opinion on the merits of the SARFAESI proceedings and required the authorities to proceed strictly in accordance with law.