Reliance Capital Ltd. vs District Magistrate Bhopal And Others

The present petition is filed under Article 226 of the Constitution of India, challenging the order dated 27-03-2018, passed by the Additional District Magistrate, Bhopal, in Case No. 96/B-121/2016-17, whereby the application filed by the petitioner under Section 14 of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 ( for short "SARFAESI Act, 2002 ") for taking physical possession of the mortgaged property owned by the respondent nos. 2 to 7 has been rejected. by the impugned order.

Upon perusal of the impugned order, it is elucidated that the authority has rejected the application under Section 14 of the SARFAESI Act, 2002 on the ground of pendency of arbitration case before the court.

Learned counsel for the petitioner submitted that the pendency of arbitration case is not a bar to initiate proceedings under SARFAESI Act, 2002. He placed reliance on the judgment passed by the Apex Court in the case of M.D.Frozen Foods Exports  Private Limited and others Vs.Hero Fincorp Limited , (2017) 16 SCC 741.

In view of the judgment passed by the Apex Court in the case of M.D.Frozen Foods Exports Private Limited(supra), we are of the considered view that the Additional District Magistrate has erroneously rejected the said application. Accordingly the said order is set aside and the matter is sent back to the Additional District Magistrate, Bhopal to take fresh decision in the matter without being influenced with the previous order expeditiously within a period of two months from the date of filing a copy of the order  passed today.

With the aforesaid, the petition is allowed and disposed of.