Bombay High Court orders Tahsildar to hand Canara Bank possession of mortgaged factory

The Bombay High Court on 12 October 2026 directed the Tahsildar of Khalapur in Raigad district to personally take physical possession of a mortgaged factory and hand it to Canara Bank. The court noted that the order to take possession, passed by the Additional District Magistrate, Raigad on 8 August 2023, had still not been carried out. It fixed 19 October 2026 as the date for taking possession.

What Happened

According to the bank's petition, it had lent to Balaji Precision Tubes (India) Pvt. Ltd., which mortgaged its factory land and building at Khalapur. The bank said the loan was declared a non-performing asset (a loan in default) on 29 January 2020, and it then acted under the SARFAESI Act, the law that lets banks enforce security without going to a civil court.

The bank told the court that the factory was sold at auction on 29 August 2025 for Rs 5.27 crore, and the plant and machinery on 14 August 2026 for Rs 1.86 crore. The Debts Recovery Tribunal dismissed the borrower's challenge on 30 June 2026, and the High Court dismissed a further petition on 4 August 2026. The bank said the Tahsildar later did not fix a possession date, citing other official work.

The court held that the Tahsildar cannot delegate this task to a junior officer. It cited its earlier ruling that every order under Section 14 of the SARFAESI Act should be executed within four weeks. It directed police protection, including women constables, and video recording of the process. It directed the borrowers and guarantors to vacate and cooperate, and warned of stern action, including contempt proceedings, if they obstruct. If possession is not taken, the officials must appear in person and file an affidavit. The matter is listed for compliance on 29 October 2026.

What It Means

The ruling reinforces that once a district authority orders possession under Section 14, local officials are expected to carry it out promptly and personally. For borrowers, it shows that delays in execution can be challenged by the lender before the High Court. Borrowers who believe a lender has acted unfairly can raise it through the bank's grievance process and, if unresolved, the RBI complaint portal at https://cms.rbi.org.in.

Source: High Court judgment