Lawstreet Journal

Advocates Can Be Appointed As ‘Receivers’ Under Section 14 (1A) Of SARFAESI Act, Says Delhi HC

Lawstreet Journal 20 Jan 2020 11:31pm

Image courtesy: Lawstreet Journal Judiciary Advocates Can Be Appointed As ‘Receivers’ Under Section 14 (1A) Of SARFAESI Act, Says Delhi HC

In a challenge to an order given by Chief Metropolitan Magistrate (CMM) appointing an advocate as a receiver under Section 14 (1A) of the Securitisation and Reconstruction of Financial Assets and Enforcement of Securities Interest Act, 2002, Delhi HC held that an advocate can be appointed as a ‘Receiver’. The Decision was given by a Single Bench of Justice Rajiv Shakdher.

Section 14 of SARFAESI says that,

(1) Where the possession of any secured asset is required to be taken by the secured creditor or if any of the secured asset is required to be sold or transferred by the secured creditor under the provisions of this Act, the secured creditor may, for the purpose of taking possession or control of any such secured asset, request, in writing, the Chief Metropolitan Magistrate or the District Magistrate within whose jurisdiction any such secured asset or other documents relating thereto may be situated or found, to take possession thereof, and the Chief Metropolitan Magistrate or, as the case may be, the District Magistrate shall, on such request being made to him—

(a) take possession of such asset and documents relating thereto; and

(b) forward such assets and documents to the secured creditor.

The petitioner said that the appointment of advocate as ‘receiver’ is contrary to the language of the section. But the court observed that the petition is not maintainable as the possession of the assets was already handed over to the secured creditor which is Andhra Bank in this case. The court… Continue Reading...

Tagged: SARFAESI Act  
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