Rajasthan High Court – Jaipur
Ugro Capital Limited vs The State Of Rajasthan on 20 July, 2026
[2026:RJ-JP:27861]
HIGH COURT OF JUDICATURE FOR RAJASTHAN
BENCH AT JAIPUR
S.B. Civil Writ Petition No. 9587/2026
URN: CW / 21444U / 2026
UGRO Capital Limited, A Non-Banking Finance Company (NBFC)
Registered Under The Companies Act And The Reserve Bank Of
India Act Having Its Registered Office At Equinox Business Park,
Tower 3 4Th Floor Lbs Road, Kurla (West), Mumbai -400070,
CIN: L67120Mh1993Plc070739 Through Its Authorised Officer
Authorised Signatory (Sujoy Roy), Having Office At District
Jhalawar, Rajasthan.
----Petitioner
Versus
1. The State Of Rajasthan, Through Its Principal Secretary,
Home Department, Government Secretariat, Jaipur.
2. The District Collector-Cum-District Magistrate, District
Jhalawar, Rajasthan.
3. The Superintendent Of Police, District Jhalawar,
Rajasthan.
4. The Station House Officer, Police Station Bhawanimandi,
District Jhalawar, Rajasthan
5. M/s Kamal Enterprises, A Proprietorship Concern, Having
Its Office At Khandaar Walon Ka Mohalla, Main Road,
Karawan, Police Station Bhawanimandi, District Jhalawar
326512 (Rajasthan), Through Its Proprietor Shri Gopal
Singh
----Respondents
For Petitioner(s) : Ms. Ayushi with
Mr. Vaibhav &
Mr. Yogesh on behalf of
Mr. Prerit Goyal
For Respondent(s) : Ms. Devakriti Vashishtha with
Ms. Sunita Meena, AGC on behalf of
Mr. Bhuwnesh Sharma, AAG
HON'BLE MR. JUSTICE ANAND SHARMA
Order
20/07/2026
1. Ms. Devakriti Vashishtha, learned counsel, appeared for
Mr. Bhuwnesh Sharma, learned Additional Advocate General and
accepts notices on behalf of respondent Nos.1 to 4.
2. Learned counsel for the petitioner submits that the
private-respondents availed loan facility from the petitioner
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financial institution however when he failed to repay the same
proceedings under the provisions of Securitisation and
Reconstruction of Financial Assets and Enforcement of Security
Interest Act, 2002 (for short, ‘the Act of 2002’) were initiated and
after carrying out proceedings under Section 14(2) of the Act of
2002, an application under Section 14 of the Act of 2002 was
moved before the concerned District Magistrate, Jaipur.
3. Learned counsel for the petitioner further submits that
the application under Section 14 of the Act of 2002 filed by the
petitioner was allowed by the District Magistrate vide order dated
25.09.2025 granting directions to the police authorities to provide
police assistance. Learned counsel also submits that by aid of
police, physical possession of the secured assets was taken by the
petitioner on 22.01.2026. After taking possession, in view of
Section 14 of the Act of 2002, the petitioner had legitimate right
to continue the possession, yet in quite malicious and
unauthorized manner, the private respondents re-entered in the
secured premises by forcibly breaking lock.
4. This Court finds that the similar controversy arose
before this Court where after passing the order under Section 14
of the Act of 2002 and after taking possession thereunder by the
secured creditor, the borrower re-entered in the secured premises,
this Court held that the concerned Magistrate does not become
functus officio and cannot be rendered powerless to issue
appropriate directions under Section 14(2) of the Act of 2002. In
the case of Jana Small Finance Bank Limited Vs. State of
Rajasthan & Ors. (S.B. Civil Writ Petition No. 10026/2026),
this Court has held as under:
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[2026:RJ-JP:27861] (3 of 6) [CW-9587/2026]“11. Core questions involved in these matters is
that once the District Magistrate/Chief Metropolitan
Magistrate issues directions under Section 14 of the Act
of 2002 directing for taking physical possession of the
secured asset with the police assistance and pursuant
thereto, possession is also handed over to the secured
creditor, a writ petition under Article 226 of the
Constitution of India would be maintainable or not, in
the event the borrower forcibly re-enters the secured
asset in violation of such order, or whether an
alternative remedy is available under the provisions of
the Act of 2002.
12. Since, the controversy revolves around the
provisions of Section 14(1) and (2), relevant portion
thereof is being reproduced hereunder:-
“14. Chief Metropolitan Magistrate or District
Magistrate to assist secured creditor in
taking possession of secured asset.–(1)
Where the possession of any secured assets is
required to be taken by the secured creditor or if
any of the secured assets is required to be sold or
transferred by the secured creditor under the
provisions of this Act, the secured creditor may,
for the purpose of taking possession or control of
any such secured assets, request, in writing, the
Chief Metropolitan Magistrate or the District
Magistrate within whose jurisdiction any such
secured asset or other documents relating thereto
may be situated or found, to take possession
thereof, and the Chief Metropolitan Magistrate or,
as the case may be, the District Magistrate shall,
on such request being made to him–
(a) take possession of such asset and documents
relating thereto; and
(b) forward such asset and documents to the
secured creditor:
1
[Provided that any application by the secured
creditor shall be accompanied by an affidavit duly
affirmed by the authorised officer of the secured
creditor, declaring that–
(i) the aggregate amount of financial assistance
granted and the total claim of the Bank as on the
date of filing the application;
(ii) the borrower has created security interest
over various properties and that the Bank or
Financial Institution is holding a valid and
subsisting security interest over such properties
and the claim of the Bank or Financial Institution
is within the limitation period;
(iii) the borrower has created security interest
over various properties giving the details of
properties referred to in sub-clause (ii) above;
(iv) the borrower has committed default in
repayment of the financial assistance granted
aggregating the specified amount;
(v) consequent upon such default in repayment
of the financial assistance the account of the
borrower has been classified as a non-performing
asset;
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(vi) affirming that the period of sixty days notice
as required by the provisions of sub-section (2) of
section 13, demanding payment of the defaulted
financial assistance has been served on the
borrower;
(vii) the objection or representation in reply to the
notice received from the borrower has been
considered by the secured creditor and reasons for
non-acceptance of such objection or
representation had been communicated to the
borrower;
(viii) the borrower has not made any repayment
of the financial assistance in spite of the above
notice and the Authorised Officer is, therefore,
entitled to take possession of the secured assets
under the provisions of sub-section (4) of section
13 read with section 14 of the principal Act;
(ix) that the provisions of this Act and the rules
made thereunder had been complied with:
Provided further that on receipt of the affidavit
from the Authorised Officer, the District Magistrate
or the Chief Metropolitan Magistrate, as the case
may be, shall after satisfying the contents of the
affidavit pass suitable orders for the purpose of
taking possession of the secured assets1 [within a
period of thirty days from the date of application]:
1
[Provided 2[also] that if no order is passed by the
Chief Metropolitan Magistrate or District
Magistrate within the said period of thirty days for
reasons beyond his control, he may, after
recording reasons in writing for the same, pass
the order within such further period but not
exceeding in aggregate sixty days.]Provided also that the requirement of filing
affidavit stated in the first proviso shall not apply
to proceeding pending before any District
Magistrate or the Chief Metropolitan Magistrate, as
the case may be, on the date of commencement
of this Act.]3
[(1A) The District Magistrate or the Chief
Metropolitan Magistrate may authorise any officer
subordinate to him,–
(i) to take possession of such assets and
documents relating thereto; and
(ii) to forward such assets and documents to the
secured creditor.]
(2) For the purpose of securing compliance with
the provisions of sub-section (1), the Chief
Metropolitan Magistrate or the District Magistrate
may take or cause to be taken such steps and
use, or cause to be used, such force, as may, in
his opinion, be necessary.”
13. Bare perusal of the aforesaid provisions
would make it clear that under Section 14(1)
necessary orders can be passed by the Chief
Metropolitan Magistrate or District Magistrate, as the
case may be for the purpose of taking possession of the
secured asset. Section 14(2) of the Act further provides
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that for the purpose of securing compliance with the
provisions of sub-section (1) the Chief Metropolitan
Magistrate or District Magistrate may direct for taking
necessary steps or cause to be used force which in his
opinion is necessary.
14. The expression “for the purpose of
securing compliance with the provisions of sub-section
(1)” is apparently having wide amplitude and cannot be
interpreted in a narrow manner. Once possession is
handed over under the orders of concerned Magistrate
under Section 14, it would essentially mean the right of
secured creditor to continue such possession which is
an integral part of proceedings under Section 14.
Section 14(2) of the Act of 2002 would also make it
clear that such provision confers enabling power upon
the concerned Magistrate for ensuring compliance of
any order passed by the Magistrate under Section 14.
If possession delivered under the Magistrate’s authority
is subsequently disturbed by force or trespass, the
Magistrate’s power under Section 14(2) can reasonably
be construed as extending to restoration of status quo
ante, so that the original order is not frustrated.
15. This Court finds that after passing order
under Section 14 for taking over possession of the
secured asset and handing over the same to the
secured creditor, concerned Magistrate does not
become functus officio and the apprehension of the
petitioner that after passing initial order under Section
14 of the Act of 2002, concerned Magistrate is rendered
powerless, is totally misconceived and is
misinterpretation of clear language of Section 14(2) of
the Act of 2002. In view of the language of the
aforesaid provision, it is clear that the concerned
Magistrate is having power not only to take possession
through police assistance of the secured asset, but
power is also vested with him for passing subsequent
orders for ensuring the compliance of earlier order
passed by the Magistrate. Any other interpretation of
the aforesaid provision is likely to frustrate the
proceedings under Section 14 and to render the powers
conferred to the concerned Magistrate as meaningless
and ineffective.
16. Under these circumstances, this Court is of
the opinion that ensuring compliance of the order
earlier passed under Section 14 is also integral and
indispensable part of powers conferred to the
Magistrate under Section 14(2) of the Act of 2002, in
case, the borrower or any other person violates the
directions given by the concerned Magistrate under
Section 14 and unauthorizedly re-enters in the
premises of secured asset then the aggrieved secured
creditor is well within its right to approach the
concerned Magistrate by way of filing an application
under Section 14(2) of the Act of 2002 with a prayer to
secure compliance of earlier order passed by the
Magistrate. Such application shall be examined in
accordance with law by the concerned Magistrate and
appropriate orders for securing compliance of the
earlier order can be passed. Thus this Court, on the
basis of foregoing discussion, comes to the conclusion
that the petitioners are having efficacious remedy
under the provisions of Section 14(2) of the Act of
2002 before the concerned Magistrate.
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17. In the instant cases, admittedly the
petitioners have not approached the concerned
Magistrate by way of filing any such application under
Section 14 (2) of the Act of 2002. This Court finds that
under such circumstances, the present writ petitions
filed by the petitioners are totally premature and not
maintainable. In view foregoing discussions, the writ
petitions filed by the petitioner can not be entertained
and are hereby dismissed.
18. However, mere dismissal of the present
writ petitions shall not curtail rights of the petitioner
financial institution to approach the concerned
Magistrate by way of filing an application under Section
14(2) for securing compliance of earlier order passed
by the Magistrate under Section 14. Any such
proceedings shall be treated in continuation to the
earlier proceedings under Section 14 of the Act of
2002. The concerned Magistrate, upon filing of such
application, shall examine the contents of the
application and shall pass appropriate orders strictly in
accordance with law, for securing compliance of its
earlier order passed by the concerned Magistrate for
the purpose of taking possession of the secured asset
and to hand over such possession to the secured
creditor. In the event, any such application is filed,
same shall be decided expeditiously by the concerned
Magistrate.”
5. In view of above judgment, this Court finds that the
controversy involved in the instant case is squarely covered by the
judgment dated 30.06.2026 passed in the case of Jana Small
Finance Bank Limited (supra). Petitioner has not exhausted the
remedy available under Section 14 of the Act of 2002, thus this
Court finds that under such circumstances, the present writ
petition filed by the petitioner is totally premature and not
maintainable.
6. In view of above, the instant writ petition is hereby
dismissed in the same terms and with the same directions and
liberty granted in Jana Small Finance Bank Limited (supra).
7. Pending application(s), if any, stand(s), disposed of.
(ANAND SHARMA),J
70/DAKSH
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