✎ Madras HC mandates proportionate advocate fees in SARFAESI cases, rejecting uniform ₹80k charges.
Relevance for Banking, SSC & RBI Grade B exams: Polity
The Madras High Court has ruled that advocate commissioners’ fees in SARFAESI cases must be proportionate to the work involved, rejecting the Chengalpattu Chief Judicial Magistrate’s practice of imposing a uniform fee of ₹80,000. The bench, led by Chief Justice Sushrut Arvind Dharmadhikari and Justice G. Arul Murugan, emphasized that fees should consider factors like the outstanding loan amount, property value, location, number of properties, and travel distance, as arbitrary fixed fees violate the doctrine of proportionality. The court set aside the orders fixing uniform fees and remanded the matter to the CJM for reassessment, highlighting the need for judicial discretion to ensure fairness in remuneration.
This ruling is significant for banking and financial sector aspirants, as it underscores the importance of judicial oversight in enforcing recovery mechanisms under the SARFAESI Act, 2002. For SSC and RBI Grade B candidates, the judgment highlights constitutional principles like proportionality and judicial discretion, which are often tested in exams. It also reflects the judiciary’s role in balancing creditor rights with fair compensation, a key theme in banking regulations and economic governance.
Source: The Hindu
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