Section 39 of The Small Industries Development Bank of India Act, 1989
- (1)Where any property, effects or actionable claims are sold or leased in pursuance of any power conferred by section 38, the Small Industries Bank or any other person authorised by it may, for the purpose of taking into custody or under control any such property, effects or actionable claims, request, in writing, the Chief Metropolitan Magistrate or the District Magistrate within whose jurisdiction any such property, effects, actionable claims, books of account or other documents relating thereto may be situated or found, to take possession thereof, and the Chief Metropolitan Magistrate or the District Magistrate shall, on such request being made to him,--
- (a)take possession of such property, effects, actionable claims, or books of account or other documents relating thereto; and
- (b)forward them to the Small Industries Bank or such other person, as the case may be.
- (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.
- (3)No act of the Chief Metropolitan Magistrate or the District Magistrate done in pursuance of this section shall be called in question in any court or before any authority.
Summary
- To physically take over a property or records after a default, the bank can request help in writing from a Chief Metropolitan Magistrate or a District Magistrate.
- The Magistrate must then take possession of the property, goods, or account books and hand them over to the bank.
- The Magistrate is legally allowed to take steps and use necessary force to secure the property or documents.
- No person is allowed to sue the Magistrate or question their actions in court for carrying out this duty to help the bank.
Practical examples
FAQ
1. Who physically enforces the bank's right to take over property?
The bank asks a Chief Metropolitan Magistrate or District Magistrate to take possession.
2. Can the Magistrate break a lock to get inside?
Yes, the Magistrate can use whatever force is necessary to secure the property.
3. Can I sue the Magistrate for taking my business assets?
No, the law protects the Magistrate from being questioned in court for these actions.
Test yourself
Q1.Under Section 39 of The Small Industries Development Bank of India Act, 1989, which authority can the bank request to take possession of property?
Q2.Under Section 39 of The Small Industries Development Bank of India Act, 1989, the bank can request a Magistrate to take custody of property specifically when that property is being sold or leased pursuant to the bank's rights under which other provision?
Q3.According to Section 39 of The Small Industries Development Bank of India Act, 1989, what is the Magistrate authorized to do to secure compliance when taking possession of property?
Q4.Under Section 39 of The Small Industries Development Bank of India Act, 1989, can the owner of the seized property sue the Magistrate for taking the property?
Q5.Understanding both Section 38 and Section 39 of The Small Industries Development Bank of India Act, 1989, what is the sequence of legal events if an industrial concern defaults and refuses to leave the factory?