Jitesh (self) 25 December 2014

Can the dm recall orders issued under section 14 of sarfaesi

Pls help with this.

In my case, the authorized officer of the Bank had moved an application before the District Magistrate under section 14 of Sarfaesi Act 2002 for taking physical possession of the assets mortgaged by me. But he had concealed the fact that I have already repaid the total interest and overdue amounts with penal interest as due on date. In fact, the application for taking over the physical possession under section 14 of Sarfaesi Act was moved one day after the amounts were deposited by me on the consent of the bank that my account will be upgraded to PA from NPA and recovery proceedings will be deferred. The District Magistrate had issued the orders for taking possession of my assets in favor of the Bank without giving a hearing to me. Now I had again moved an application before the DM to recall his orders for possession since the banker had concealed important facts in the application and the said application is liable to be dismissed as my account can not be treated as NPA in view of the RBI guidelines vide circular No. RBI/2014-15/74 DBOD.No.BP.BC.9/21.04.048/2014-15 on Income recognition, asset classification and provisioning pertaining to advances.

Pls let me know if the DM has the authority to recall the orders previously issued by him.

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10 Replies

Jai Karan Nagwan (consultant) 25 December 2014

I don't think that magistrate has power to review under SARFRAESI, however remedy is available u/s 17 of the act. So advised to file application according and at the same another remedy available under writ, but HC may reject on the ground of availability of effacicacious remedy under Sec 17. All the best.

c.p.s. ramachary (1500) 26 December 2014

No DM does not decide any issue over which DRT is conferred with jurisdiction. Did you raise your objections to the demand notice. If not you can raise it now before the notice under Sec.13(4) is served. You may file an application u/s 17 of SARFAESI Act pleading the above points in your query and obtain stay producing copy of your objections, the statement of account and evidence of payments and obtain stay order engaging an advocate well versed in SARFAESI Act.

T. Kalaiselvan, Advocate (Advocate) 27 December 2014

Intervention by DRT by way of stay will be the only option before you now and not the DM's action.

Uday (Lawyer) 29 December 2014

To the kind attention of Mr.C,P.S.Ramachary Sir: Sir, We filed a petition under section 14 of the SARFAESI Act before the District Magistrate. After we filed a petition under section 14 of the SARFAESI Act, the borrower sent a DD for Rs.22,000/- whereas the amount for regularisation at that point in time was more than 2 Lakhs. We returned the DD to the borrower stating that the matter is subjudice. Subsequently the District Magistrate has dismissed the petition on the following grounds.

1) The borrower has been asked by the District Magistrate to regularise the account within a month from a particular day and the borrower has made a part payment of Rs.22,000/- which was not accepted by the company.

2) Disobeying the order of the District Magistrate is not acceptable.

3) The Secured Creditor can resort to some other remedy for recovery of their dues.

Note: The copy of communication sent by the District Magistrate to the borrower was not sent to us.

Please let us know what is the remedy available to us. Should we take this matter up to the High Court or is there any other remedy apart from this?

Uday (Lawyer) 29 December 2014

2) Disobeying the order of the District Magistrate is not acceptable.

3) The Secured Creditor can resort to some other remedy for recovery of their dues.

Note: The copy of communication sent by the District Magistrate to the borrower was not sent to us.

Please let us know what is the remedy available to us. Should we take this matter up to the High Court or is there any other remedy apart from this?

c.p.s. ramachary (1500) 30 December 2014

The query was raised by borrower. I conveyed my advise to him through this forum. Hence I am unable to advise you (the secured creditor) any thing in the matter as it would not be proper on my part. Please understand the situation. As a lawyer you can think about the course of action open to you in the matter.

surendra prakash agrawal (advocate) 27 February 2015

Sir, First available remedy against Sec. 13 (2) Notice was to register protest U/s 13(3A)within 45 days. DM provides police assistance to Authorised Officer who has quasi judicial function so approach to Authorised Officer to rectify his action. Remedy u/s 17 of SARFAESI attracts fee and time consumable. High Courts in Writ Petition normally order to avail alternate remedy u/s 17 to avail first. Thereafter DRAT may be next legal remedy and thereafter High Court an d Supreme Court to exhaust available legal remedies upto upto last. SURENDRA PRAKASH AGRAWAL

(Guest)

Well advised.

(Guest)

Mr. Uday,

Mix up of your own problem with the problem of Mr. Jitesh may not help you get adequate response from the experts with appropriate solution. So, post your query in a separate thread, if you need proper guidance.

KUSHAGRA 24 April 2018

There is no provision / section under the Act,2002 whereby District Magistrate can recall his order, but if the Bank has filed the Application under section 14 by concealing the fact or under mis representation then certainly that order can be recalled on the ground of fraud / mis representation.

Even in some of my cases DM has recalled his order passed under section 14 on the ground that the Bank has obtain the order by mis representation and fraud.

“Any order obtain by playing fraud with the Court is null and void”

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