District Magistrate Must Decide Section 14 SARFAESI Applications Within Statutory Timelines to Ensure Expeditious Debt Recovery

The petitioner Bank extended financial assistance to respondent borrowers who subsequently defaulted on repayments, leading to their loan account being classified as a Non-Performing Asset (NPA)

The Bank initiated proceedings under the SARFAESI Act, 2002, issuing a demand notice under Section 13(2) and a subsequent possession notice

To obtain physical possession of the secured assets, the Bank filed an application under Section 14 before the District Magistrate, Korba, on October 10, 2025 (Revenue Case No. 202510050400010)

The petitioner approached the High Court via a writ petition alleging that despite the statutory mandate for expeditious disposal, the application remained pending for over sixty days without justification

1. Whether the respondent authorities are mandated to decide applications under Section 14 of the SARFAESI Act, 2002 within a specific statutory timeframe

2. Whether a writ of mandamus should be issued to the District Magistrate to expedite the pending administrative proceedings for taking possession of the secured asset

Section 14 of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest (SARFAESI) Act, 2002

The court noted that the statutory scheme contemplates expeditious consideration of such applications, observing that these proceedings are administrative in nature, involving only the verification of statutory compliance rather than the adjudication of inter-se disputes

The rule dictates that the authority must act within the time prescribed by the statute to facilitate the recovery of public money and enforcement of security interests

The Court observed that the petitioner had exhausted the necessary preliminary steps under Section 13(2) and 13(4) of the SARFAESI Act before moving the Section 14 application

It found that the application had been pending since October 2025, exceeding the intended statutory period of sixty days

The Court reasoned that since Section 14 proceedings do not involve adjudication of complex disputes but are procedural and administrative aids for recovery, indefinite delays frustrate the legislative intent of the Act

With the State counsel expressing no objection to a time-bound disposal, the Court determined that the ends of justice necessitated a directive to the competent authority to complete the verification process and pass orders promptly

The Court ordered the disposal of the case within a period of 45 days from the date of receipt of the certified copy of the order

It clarified that it expressed no opinion on the merits or the entitlement of the petitioner, leaving the competent authority to pass an independent order

No order as to costs was made