- (1.) Petitioner is a company incorporated under the Companies Act, 1956 and registered with the Reserve Bank of India under Section 3 of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (for short the 'SARFAESI Act, 2002') and thus is covered under the definition of Reconstruction Company and Securitisation Company as defined under the provisions of the SARFAESI Act.
(2.) Application made by the petitioner company under Section 14 of the SARFAESI Act seeking assistance from the District Magistrate in taking over possession of the secured asset was not being entertained and thus a representation was made pointing out that since the petitioner being a Securitisation and Assets Reconstruction Company, on being assigned rights and interest, created in favour of any bank or financial institution in any loan or advance granted or created, steps into the shoe of the lender and is entitled to make application under Section 14. On the said representation, the Additional District Magistrate (Finance & Revenue) submitted a report dated 18.6.2014 to the effect that since the petitioner company is not covered under the definition of "Financial Institution" as defined under Section 2(m)(iv) of the SARFAESI Act, 2002 as it has not been notified as Financial Institution by the Central government, as such, it is not entitled to maintain a claim for enforcement of security interest provided by Section 13 of the SARFAESI Act as the said power can only be exercised by a secured creditor and for the said reason, the application made by the petitioner under Section 14 is not maintainable and not liable to be entertained. The District Magistrate vide order dated 23.8.2014 approved the report of the Additional District Magistrate.
(3.) Learned counsel for the petitioner contends that the petitioner being a registered Securitisation and Assets Reconstruction Company is entitled to acquire rights and interest any financial assets of the bank and financial institution under the provisions of the SARFAESI Act, 2002 and can enforce the same under Section 13 of the said Act and thus is entitled to maintain the application under Section 14 and the view of the respondents that application on behalf of the petitioner is not maintainable is per se illegal and without jurisdiction and against the provisions of the SARFAESI Act, 2002.;