Title: SMFG INDIA CREDIT COMPANY LTD formerly known as FULLERTON INDIA CREDIT COMPANY LTD v. ADDITIONAL DISTRICT MAGISTRATE DISTRICT INDORE ADD. COLLECTORATE OFFICE MOTI TABELA DISTRICT INDORE (MADHYA PRADESH) & OTHERS
Decided on:18th October 2023
WRIT PETITION No. 15800 of 2023
Coram: HON’BLE JUSTICES S. A. DHARMADHIKARI & PRANAY VERMA
Introduction
High court of Madhya Pradesh has allowed instant writ petition by quashing the order of the additional district magistrate, Indore, which was in contempt of the high court’s order.
Facts of the case
The petitioner does a business of providing loan to its customers. The respondent no. 2 to 5 approached the petitioner to avail a loan of Rs. 97,78, 740/-. Respondents to secure the repayment of the loan mortgaged property measuring 1800 Sq. Ft. at Indore in favor of petitioner . The account of the respondent no.2 to 5 was classified as Non Performing Asset, for their irregular repayment of loan as per the terms and conditions. Notices u/S 13(2) of the SARFAESI Act were served upon the respondents. Petitioner filed application u/S 14 of the SARFAESI Act before the District Magistrate, Indore for taking possession of the property in question from the respondent no.2 to 5. The case was then transferred to respondent no.1 i.e. Additional District Magistrate, Indore for requisite action. Instead of assisting the petitioner to take possession, of the property respondent no.1 issued notices to the borrowers and provided them opportunity to defend the application challenged by the petitioner. The petition was allowed wherein directions were issued to the respondent no.1 to decide the application without affording any opportunity of hearing to the respondent no.2 to 5. The petitioner again made a representation to the respondent no.1 for compliance of the order passed by district magistrate but to no avail. Thereafter, petitioner has moved a contempt petition against the respondent no.1 for posting the matter for 28.06.2023 and on the said date respondent no.1 has rejected the application filed by the petitioner u/14(1) of SARFAESI Act by observing that respondents have filed SARFAESI application before the DRT, Jabalpur which is pending adjudication and therefore, respondent no.1 has become functus officio. Hence petitioner has filed an instant writ petition criticizing the order dated 28.06.2023 passed by the respondent no.1.
Court Analysis and Decision
Court observed that the Additional District Magistrate, Indore namely Mrs. Sapna M. Lovanshi in several cases attained the role of adjudicatory authority citing reasons that she becomes functus officio and the remedy available to the petitioner is before the DRT, Jabalpur. Court vide order dated 13.07.2023 had directed her to remain personally present before the Court to explain as to why the authority has interpreted the order on its own brushing aside the order of this order which amounts to contempt of Court. Though, the Additional District Magistrate had filed her reply, on perusal of the same, there is no explanation as to how she becomes functus officio. The role of DM & ADM is ministerial in nature so far as Section 14 of the SARFAESI Act is concerned. In a number of cases, it is seen that the orders are passed as per convenience of the Officer without following the mandate of the Apex Court. Since no explanation has been put forth by the Additional District Magistrate, Indore, as to how she becomes functus officio, the Court opined that heavy cost must be imposed on the Officer for deliberately interpreting the law as per her convenience.
The Officer concerned has also filed I.A. No. 6354/2023 seeking permission to withdraw the impugned order dated 28.06.2023 which shows that she is in the habit of exercising the powers arbitrarily. Thus, the petitioner’s petition was allowed quashing the order dated 28.06.2023 and respondent no.1 is directed to pass the order afresh in accordance with law keeping in view the statutory provisions as contained in Section 14 of the SARFAESI Act as well as in the light of the judgment passed in the case of Cholamandlam Investment and Finance Ltd. (supra) within 30 days & extended 60 days only after recording reasons for delay. Mrs. Sapna M. Lovanshi, Additional District Magistrate, Indore was charged Rs. 10,000/- for wasting the precious time of the Court which could have been utilized in deciding more pressing matters and the cost must be deposited by herself from her own pocket and not to be borne by the State Government.
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Written by- K R Bhuvanashri
