SARFAESI Court Commissioner Fees Must Reflect the Applicant Bank’s Financial Capacity and Required Effort.

The petitioner bank, which was under liquidation, approached the Trial Court under Section 14 of the SARFAESI Act, 2002, seeking possession of secured assets.

On 2 January 2026, the Trial Court appointed an advocate as Court Commissioner to take possession of 167 flats and directed the bank to deposit a fee of ₹15,00,000.

The Trial Court rejected the bank’s application to modify that amount on 22 July 2026.

The bank challenged both orders only insofar as they fixed the Commissioner’s fee, relying, among other matters, on its financial constraints and liquidation status.

1. Whether the Trial Court’s order quantifying the Court Commissioner’s fee was adequately reasoned.

2. Whether the fee of ₹15,00,000 was excessive, having regard to the work required and the petitioner bank’s financial position.

Section 14 of the SARFAESI Act, 2002 provides a mechanism for obtaining assistance from the Chief Metropolitan Magistrate or District Magistrate to take possession of secured assets.

The Act does not prescribe a fee schedule for the officer authorised to take possession.

In fixing a Court Commissioner’s fee, the Trial Court must consider relevant circumstances, including the work and effort involved and the applicant bank’s financial capacity, and balance those factors.

The judgment cites no precedent.

The Trial Court justified the ₹15,00,000 fee principally by reference to the need to take possession of 167 flats, without adequately addressing the bank’s submission that it was under liquidation, had an official liquidator appointed, and faced substantial liabilities to depositors.

The High Court held that the number of flats and the work involved had to be balanced against the bank’s financial position.

Given the circumstances, it found the fee excessive and reduced it to ₹2,00,000.

It further clarified that, if the appointed Commissioner was unable to act, the Trial Court could appoint another competent person to implement the Section 14 application.

Rule was made absolute.