Madras High Court Issues Statewide Directions For Timely Disposal Of SARFAESI Pleas Seeking Aid In Taking Possession Kirit Singhania 6 June 2026 11:08 AM (8 mins read ) Share this The Madras High Court on Friday issued a comprehensive set of statewide directions governing applications under Section 14 of the SARFAESI Act. The Court observed that delays by designated authorities defeat

[07/06, 09:19] sekarreporter1: Madras High Court Issues Statewide Directions For Timely Disposal Of SARFAESI Pleas Seeking Aid In Taking Possession
https://www.livelawbiz.com/recovery-laws/high-court/madras-high-court-issues-11-directions-for-speedy-disposal-of-sarfaesi-pleas-seeking-aid-in-taking-possession-537008
[07/06, 09:19] sekarreporter1: TOP STORIES SUPREME COURT & HIGH COURTS IBC IPR GST/VAT/CST CUSTOMS/EXCISE/SERVICE TAX Top Stories Supreme Court & High Courts IBC IPR GST/VAT/CST CUSTOMS/EXCISE/SERVICE TAX INCOME TAX OTHER TAXES COMPANY LAW/LL/MSME ARBITRATION SECURITIES LAW COMMERCIAL COURTS ACT RERA COMPETITION LAW MERGER/ACQUISITION COMPLIANCE/REGULATORY BANKING/NBFC DEBT RECOVERY LAWS DIGESTS COLUMNS LAW FIRMS INTERVIEWS PMLA/FEMA Home/DEBT RECOVERY LAWS/High Court/Madras High Court Issues Statewide… Madras High Court Issues Statewide Directions For Timely Disposal Of SARFAESI Pleas Seeking Aid In Taking Possession Kirit Singhania 6 June 2026 11:08 AM (8 mins read ) Share this The Madras High Court on Friday issued a comprehensive set of statewide directions governing applications under Section 14 of the SARFAESI Act. The Court observed that delays by designated authorities defeat the legislation’s objective of enabling expeditious recovery of secured assets and reducing non-performing assets (NPAs). Section 14 of the SARFAESI Act enables banks and other secured creditors to seek the assistance of a Chief Metropolitan Magistrate, Chief Judicial Magistrate or District Magistrate for taking physical possession of secured assets when possession cannot be obtained directly. Also Read – SARFAESI Sale Certificates Not Liable To Stamp Duty Upon Issuance: Kerala High Court [Full Bench] Advertisement The provision is commonly invoked after a borrower defaults and the secured asset is sought to be taken over or handed to an auction purchaser. The directions were issued by a Bench comprising Chief Justice Sushrut Arvind Dharmadhikari and Justice G. Arul Murugan while dealing with a petition filed by Vijayanand Srinivasan, the successful auction purchaser of Villa No. 75 at Palm Villas in Nallambakkam Village, sold by Punjab National Bank under the SARFAESI Act. Also Read – Magistrate Cannot Refer Parties To Mediation In SARFAESI Proceedings Under Section 14: Kerala High Court Although the bank had received the entire sale consideration and issued a sale certificate on June 3, 2025, physical possession of the property had not been handed over. The bank informed the Court that its application under Section 14, filed before the Chief Judicial Magistrate, Chengalpattu, in August 2025, had not yet been numbered. It further submitted that around 200 cases remained pending before the court for registration and disposal. Also Read – Unauthenticated Alteration In Cheque Date Renders It Void: Kerala High Court Advertisement Taking note of a growing number of petitions complaining of delays and excesses in Section 14 proceedings, the Court said the problem had become widespread. “The State of Tamil Nadu is no exception to this phenomenon. This Court has been inundated with writ petitions filed by various banks, financial institutions and asset reconstruction companies aggrieved by the inaction or excess of jurisdiction by the Designated Authorities under Section 14 of the SARFAESI Act. Such avoidable litigation not only burdens this Court, but also defeats the very purpose of the SARFAESI Act, which is a special legislation enacted with the specific object of enabling expeditious recovery of secured assets to reduce non-performing assets (NPAs) in the banking sector.” Also Read – Madras High Court Upholds Forfeiture of 25% Bid Amount in SARFAESI Auction Case The Court accordingly issued the following directions applicable to all Chief Metropolitan Magistrates, Chief Judicial Magistrates, and District Magistrates exercising powers under Section 14 across Tamil Nadu: Applications filed by secured creditors under Section 14 must be registered immediately and cannot be listed for arguments on registration or subjected to pre-registration hearings. Authorities must confine their scrutiny to whether the secured asset falls within their territorial jurisdiction, whether notice under Section 13(2) has been served on the borrower, whether the application is accompanied by the affidavit required under Section 14(1), and whether any exception under Section 31 of the Act applies. Proceedings under Section 14 are ministerial and not adjudicatory. Authorities cannot decide disputes between secured creditors, borrowers or third parties, which fall within the jurisdiction of the Debt Recovery Tribunal. Borrowers, mortgagors, guarantors and third parties generally need not be issued notice before orders are passed under Section 14. Authorities may also use force where necessary to secure compliance. Orders on Section 14 applications must be passed within 30 days of filing. In exceptional circumstances, the period may be extended up to a maximum of 60 days after recording reasons in writing. Authorities may authorise subordinate officers or appoint Advocate Commissioners to take possession of secured assets and hand them over to secured creditors. Where a person in possession claims tenancy or lease rights that existed before the property was mortgaged, authorities must follow the law laid down by the Supreme Court. Such occupants must be given an opportunity to present their case, but the inquiry should be confined to verifying whether the tenancy claim is genuine and should not hold up the proceedings indefinitely. Tenants, occupants and other persons aggrieved by action taken under the SARFAESI Act can approach the Debt Recovery Tribunal under Section 17. The Court said authorities should make a note of this statutory remedy in their orders. If an application remains undecided beyond the time prescribed under the Act and the matter reaches the High Court, the authority concerned will have to explain the delay. The Court cautioned that unexplained delays may invite adverse remarks and appropriate consequential orders. The Registrar General of the High Court was directed to circulate the judgment through Principal District and Sessions Judges to Metropolitan Magistrates, Chief Judicial Magistrates and Additional Chief Judicial Magistrates exercising jurisdiction under Section 14. The Chief Secretary of Tamil Nadu was directed to circulate the judgment among District Magistrates and Additional District Magistrates across the State to avoid delays and unnecessary litigation. The Court reiterated that authorities exercising powers under Section 14 are not expected to adjudicate disputes. “The nature of the inquiry under Section 14 of the SARFAESI Act is ministerial and not adjudicatory. The Designated Authority is not required and is indeed prohibited from adjudicating upon any dispute between the secured creditor and the borrower, or between the secured creditor and any third party,” the bench observed. The case arose from Srinivasan’s purchase of Villa No. 75 at Palm Villas in Nallambakkam Village through a Punjab National Bank auction. Although the bank had received the entire sale consideration and issued a sale certificate on June 3, 2025, physical possession of the property had not been handed over. The bank informed the Court that its application under Section 14, filed before the Chief Judicial Magistrate, Chengalpattu, in August 2025, had not yet been numbered. It further submitted that around 200 similar applications were pending before the court. Relying on the Supreme Court’s decisions in R.D. Jain & Company v. Capital First Ltd. and Balkrishna Rama Tarle v. Phoenix ARC Pvt. Ltd., the High Court reiterated that authorities acting under Section 14 are required only to verify statutory compliance and facilitate possession of secured assets and cannot adjudicate disputes between parties. Disposing of the petition, the Court directed the Chief Judicial Magistrate, Chengalpattu, to take up Punjab National Bank’s pending Section 14 application and decide it within 30 days in accordance with the Act and the directions laid down in the judgment For Petitioner: Advocate M.L. Ramesh For Respondent: M.L. Ganesh, Standing Counsel Tags Madras High CourtChief Justice Sushrut Arvind DharmadhikariJustice G. Arul MuruganDebt Recovery Laws Case Title : VIJAYANAND SRINIVASAN vs PUNJAB NATIONAL BANK Case Number : WP No.16489 of 2026 CITATION : 2026 LLBiz HC (MAD) 139 To Read the full text of the Order CLICK HERE Next Story Similar Posts SARFAESI Sale Certificates Not Liable To Stamp Duty Upon Issuance: Kerala High Court [Full Bench] The Kerala High Court has recently held that a sale certificate issued pursuant to an auction sale under the SARFAESI Act is not liable to stamp duty merely upon its issuance. The Court also held that a Registering Officer cannot refuse to file a copy of such certificate on the ground that it is unstamped. A Full Bench comprising Justices Sathish… Magistrate Cannot Refer Parties To Mediation In SARFAESI Proceedings Under Section 14: Kerala High Court The Kerala High Court has set aside an order referring a SARFAESI proceeding to mediation, holding that the role performed by a Magistrate in such proceedings is purely ministerial and does not involve any adjudicatory process. Justice P.V. Balakrishnan observed that a Chief Judicial Magistrate or Additional Chief Judicial Magistrate exercising… Unauthenticated Alteration In Cheque Date Renders It Void: Kerala High Court The Kerala High Court has recently held that an alteration in the date of a cheque that is not authenticated by the drawer’s full signature amounts to a material alteration and renders the cheque void, while upholding an acquittal in a cheque dishonour case. Justice A. Badharudeen held: “When there is alteration of the date in the cheque which is… Madras High Court Upholds Forfeiture of 25% Bid Amount in SARFAESI Auction Case On 4 June, the Madras High Court dismissed a writ petition and held that a defaulting auction purchaser cannot claim refund of the 25% deposit when he repeatedly fails to pay the balance sale consideration despite extensions, and the rules permit forfeiture of the amount in such circumstances. A Division Bench comprising Chief Justice Sushrut… Delhi High Court Refuses To Restore LOC Against SSK Trading Directors In Bank Fraud Case On 4 June, the Delhi High Court dismissed Bank of Baroda’s appeal and upheld a 21 January 2026 order of a Single Judge that had quashed a Look Out Circular (LOC) issued against Surender Kumar Bansal and another director of SSK Trading Pvt. Ltd. in a bank fraud and loan default case, subject to conditions requiring them to cooperate with the… S.138 NI Act Case Cannot Fail For Non-Examination Of Authorised Representative: Calcutta High Court The Calcutta High Court on 20 May held that a complaint under Section 138 of the Negotiable Instruments Act, 1881 cannot be rejected solely on the ground that the complainant’s original authorised representative was not examined, where the court could have exercised powers under Section 311 CrPC to summon the witness and ensure a just decision. … DRT Competent To Order Release Of Title Documents After Loan Settlement: Allahabad High Court On 4 June, the Allahabad High Court held that the Debts Recovery Tribunal (DRT) can decide applications seeking release of title documents from a bank after full repayment of a loan. Borrowers cannot invoke writ jurisdiction for release of such documents when an effective remedy is available before the DRT. A Division Bench of Justices Shekhar B…. Pre-Deposit Under SARFAESI Can Be Based On Creditor’s Claim If DRT Has Not Determined Debt: Kerala HC On 2 June, the Kerala High Court held that where the Debts Recovery Tribunal (DRT) has not determined the debt due from a borrower, the pre-deposit required for maintaining an appeal under Section 18 of the SARFAESI Act can be computed on the basis of the amount claimed by the secured creditor. A Division Bench comprising Chief Justice Soumen Sen… Writ Petition Not Maintainable Against Private ARC Enforcing Security Interest: Madras High Court On 2 June, the Madras High Court dismissed a writ petition challenging a pre-sale auction notice issued under the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002, and held that Article 226 jurisdiction does not extend to a private Asset Reconstruction Company (ARC) enforcing contractual rights,… Cheque Dishonour Notice Must Specify Amount Demanded, Else No Valid Notice In Eye Of Law: Kerala High Court The Kerala High Court has held that a statutory demand notice issued in a cheque dishonour case must specifically mention the amount demanded, failing which there would be no legal notice in the eye of law. “Only when the notice is specific about the amount, it is possible for the recipient of the notice to pay the amount which was specifically… Technical Glitch Could Have Misled Bidder; Kerala High Court Directs Central Bank To Refund Auction Deposit The Kerala High Court has upheld a direction requiring the Central Bank of India to refund money deposited by an auction participant after finding that an admitted technical glitch could have led her to believe that her bid had not been accepted. A Division Bench of Chief Justice Soumen Sen and Justice Syam Kumar V.M. passed the order while partly… About Us Contact Us Advertise with us Careers Privacy Policy Terms & Conditions Top Stories INCOME TAX MSME Know the Law Compliance Other Taxes IBC PMLA & FEMA Competition Law Law Firms ARBITRATION Supreme Court & High Courts IPR Company Law Regulatory Interviews Columns Commerical Court Act GST / VAT / CST LLP Securities Law Debt Recovery Laws Banking/NBFC Custom & Excise & Service Tax RERA Compliance Digests Merger and Acquisition 2026 © All Rights Reserved @LiveLaw Media Pvt Ltd Powered By – Blink CMS We use cookies for analytics, advertising and to improve our site. You agree to our use of cookies by continuing to use our site. To know more, see our Cookie Policy and Cookie Settings.Ok

https://www.livelawbiz.com/recovery-laws/high-court/madras-high-court-issues-11-directions-for-speedy-disposal-of-sarfaesi-pleas-seeking-aid-in-taking-possession-537008