Allowed

Union Bank of India v. State of Karnataka

Karnataka HC8 Nov 2024WP/105921/2024

Case brief

AI extract

What is this about?

The High Court allowed a writ petition filed by a bank seeking directions to State officials to implement an order dated 09/12/2019 regarding the possession of mortgaged properties. The court directed the respondents to comply within four weeks and to ensure police protection during the process.

What did the court decide?

Direction to Respondents 2 and 3 to implement the order dated 09/12/2019 within 4 weeks and provide police protection.

Union Bank of India Vs State of Karnataka — Banking and Recovery | Karnataka HC (2024)

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1 - NC: 2024:KHC-D:16335 WP No. 105921 of 2024

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IN THE HIGH COURT OF KARNATAKA,

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DHARWAD BENCH

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DATED THIS THE 8^TH DAY OF NOVEMBER, 2024

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BEFORE

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THE HON'BLE MR. JUSTICE PRADEEP SINGH YERUR

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WRIT PETITION NO. 105921 OF 2024 (GM-RES)

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BETWEEN:

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UNION BANK OF INDIA, HAVING ITS REGISTERED HEAD OFFICE AT MUMBAI AND ITS BRANCH OFFICE AT ASSET RECOVERY BRANCH, HUBBALLI, REPRESENTED BY ITS CHIEF MANAGER/AUTHORIZED OFFICER, NAMELY LAXMESH BHARGAV.

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…PETITIONER

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(BY SRI. GIRISH S. HULMANI, ADVOCATE)

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AND:

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STATE OF KARNATAKA, REPRESENTED BY ITS SECRETARY, MULTI STORIED BUILDING, DR. AMBEDKAR VEEDHI, BENGALURU-560001.

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MALLIKARJUN RUDRAYYA KALMATH

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Location: HIGH COURT OF KARNATAKA DHARWAD BENCH

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DEPUTY COMMISSIONER CUM DISTRICT MAJISTRATE, KOPPAL DISTRICT, KOPPAL-583231.

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THE OFFICE OF TAHSILDAR, GANGAVATHI TALUKA, GANGAVATHI, DIST: KOPPAL-583227.

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M/S SAMARTH MOTORS, REPRESENTED BY ITS MANAGING PARTNER, MR. KELOJI SANTOSH SHRESTY, AGE: 50 YEARS, OCC: BUSINESS, PLOT NO.122, NEAR AMBAVANI TEMPLE ROAD, GANGAVATI, KOPPAL, DIST: KOPPAL-583227.

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2 - NC: 2024:KHC-D:16335 WP No. 105921 of 2024

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MR. KELOJI SANTOSH SHRESTY, S/O. SHRINIVAS SHRESTY, H.NO.4/3/190, KELOJI STREET, NEAR BASAVANNA CIRCLE, WARD NO.17, GANGAVATI, KOPPAL, DIST: KOPPAL-583231.

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MR. RAVI KORA S/O. VISHWANATH, WARD NO.2, MARLANAHALLI, GANGAVATI, KOPPAL, DIST: KOPPAL-583231.

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G. RAMU S/O. G. RAMAKRISHNA, #34 NEAR SRIRAMA TEMPLE BASAVANNA DURGA CAMP BASAVANADURGA, GANGAVATHI, KOPPAL, DIST: KOPPAL-583231.

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MR. G. SAI BABU S/O. G. VENKAT RAO, HOUSE NO.22, BASAVANNA DURGA CAMP BASAVANADURGA, GANGAVATHI, KOPPAL, DIST: KOPPAL-583231.

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MRS. KORA PADMAVATHI W/O. RAVI KORA, D.NO.44, BLOCK NO.2, MARLANAHALLI KARATAGI, GANGAVATHI, KOPPAL, DIST: KOPPAL-583231.

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MR. RAJASHEKARAPPA YELBURGI S/O. BASAPPA, H.NO.5/9/293 WARDS BLOCK-9, GASTHER STREET CAMP BASAVANADURGA, GANGAVATHI, KOPPAL, DIST: KOPPAL-583231.

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THE SUPERINTENDENT OF POLICE, KOPPAL, DIST: KOPPAL-583231.

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…RESPONDENTS

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(BY SRI. V.S. KALASURMATH, HCGP FOR R1-R3 AND R11; NOTICE TO R4-R10 DISPENSED WITH)

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THIS WRIT PETITION IS FILED UNDER ARTICLES 226 AND 227 OF THE CONSTITUTION OF INDIA PRAYING TO

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3 - NC: 2024:KHC-D:16335 WP No. 105921 of 2024

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a) ISSUE A WRIT OF MANDAMUS THEREBY DIRECTING THE RESPONDENT NO.1 TO FORMULATE NECESSARY GUIDELINES FOR EFFECTIVE IMPLEMENTATION OF THE ORDERS PASSED UNDER SARFAESI ACT, 2002 AND OTHER FINANCIAL RECOVERY PROCEEDINGS BY ITS OFFICIALS, DEPARTMENTS, AUTHORITIES IN RECEIVING, PROCESSING, PASSING ORDERS, IMPLEMENTING THE ORDERS.

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b) ISSUE A WRIT OF MANDAMUS THEREBY DIRECTING THE RESPONDENT NO.2 TO IMPLEMENT THE ORDER PASSED DATED 09/12/2019 VIDE ANNEXURE - E, IN ITS TRUE SPIRIT.

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c) ISSUE A WRIT OF MANDAMUS THEREBY DIRECTING THE RESPONDENT NO.3 TO TAKE NECESSARY STEPS TO TAKE OVER THE POSSESSION OF THE MORTGAGE PROPERTIES AND HAND IT OVER TO THE PETITIONER IN ACCORDANCE WITH LAW IN A TIME BOND MANNER IN COORDINATION WITH ITS IMPLEMENTATION AGENCIES AS PER THE ORDER PASSED BY RESPONDENT NO.2 DATED 09/12/2019 VIDE ANNEXURE-E.

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d) THIS HON’BLE COURT MAY ALSO KINDLY BE PLEASED TO ISSUE NECESSARY DIRECTION TO THE RESPONDENT NO.1 TO FORMULATE AND LAID DOWN NECESSARY GUIDELINES IN RELATION TO THE PROCEDURE LAID DOWN U/SEC.14 OF SARFAESI ACT, 2002 TO IMPLEMENT THE ORDER IN A TIME BOUND MANNER.

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e) ANY OTHER ORDER WHICH DEEMS FITS IN THE FACTS AND CIRCUMSTANCES OF THE CASE, IN THE INTEREST OF JUSTICE AND EQUITY.

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THIS PETITION, COMING ON FOR ORDERS, THIS DAY, THE COURT MADE THE FOLLOWING:

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4 - NC: 2024:KHC-D:16335 WP No. 105921 of 2024

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ORAL ORDER

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(PER: THE HON'BLE MR. JUSTICE PRADEEP SINGH YERUR)

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Learned counsel for the petitioner submits that he

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would not rely on Annexures-C and D, hence objection raised by registry at Sl.No.27 is overruled.

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2. Petitioner is a nationalized bank. Respondent No.4 had approached the petitioner-bank and availed financial loan and accordingly credit facility was given to an extent of Rs.5,34,00,000/-. Respondents No.5 to 10 have mortgaged the schedule properties to the bank towards loan advance.

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3. Thereafter, on the petitioner-bank classifying the respondents’ accounts as NPA with an outstanding due amount to an extent of Rs.5,79,30,437.97/- plus interest as on 01.07.2019 and initiated recovery proceedings by issuing demand notice under Section 13(2) of the Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (for short, ‘the SARFAESI Act’) calling respondents No.4 to 10 to

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5 - NC: 2024:KHC-D:16335 WP No. 105921 of 2024

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discharge the due amount along with interest. In view of respondents having failed to comply the demand notice for loan taken of the mortgaged properties, a possession notice was given on 18.09.2019 by way of publishing in two vernacular daily newspaper published on 20.09.2019 and this being the state of affairs, the petitioner-bank made an attempt to take possession of the mortgaged properties, but however physical possession could not be taken due to the resistance of respondents No.4 to 10 and their agents. Accordingly, petitioner-bank filed an application under Section 14 of the SARFAESI Act before the 2^nd respondent, which came to be allowed directing the 3^rd respondent to take over the possession of the mortgaged properties and hand it over to the petitionerbank.

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4. This being the state of affairs, despite making several representations to the 3^rd respondent to take necessary steps, no action is taken, for taking possession of the properties and hand it over to the bank. Hence,

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6 - NC: 2024:KHC-D:16335 WP No. 105921 of 2024

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petitioner is before this Court seeking a writ of mandamus for a direction to the 2^nd respondent to implement the order passed on 09.12.2019 vide Annexure-E and a direction to respondent No.3 to take necessary steps to take over possession of the mortgaged property and hand over the same to the petitioner-Bank. Hence, the present petition.

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5. Learned AGA representing the State submits that representations so made by the petitioner would be considered in accordance with law, if otherwise, they are entitled to. Under the circumstances, I pass the following :

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ORDER

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(i) Petition is allowed.

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(ii) Writ of mandamus is issued directing respondents No.2 and 3 to implement the order dated 09.12.2019 vide Annexure-E within an outer limit of 4 weeks from the

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date of receipt of copy of this order, in accordance with law

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7 - NC: 2024:KHC-D:16335 WP No. 105921 of 2024

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(iii) While acting on the said representations,

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respondents No.2 and 3 shall consider same by providing the Police protection. Matter is of the year 2019, nothing has moved further despite the petitioner

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securing the order.

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Sd/(PRADEEP SINGH YERUR) JUDGE

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CKK CT-MCK List No.: 1 Sl No.: 8

Union Bank of India v. State of Karnataka

Case brief

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Union Bank of India v. State of Karnataka

Case brief

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