Disposed¶66

Parvathamma Narshimaiah Charitable Trust v. the Authorized Officer

Karnataka HC2 Apr 2025WP/11956/2023

Case brief

AI extract

What is this about?

SARFAESI Act 2002 Section 14(1) order challenged under Articles 226/227; Section 13(4) notice/action challenge pending before DRT Diary No.2086/2022; writ petition withdrawn with liberty; Clix Capital Services Pvt. Ltd. (formerly GE Money Financial Services); Crl.Misc.No.218/2022, Prl. Senior Civil Judge & CJM Mandya; interim stay conditional on Rs.2,10,00,000/- deposit in three Rs.70,00,000/- installments; Justice M. Nagaprasanna; NC: 2025:KHC:13762.

What did the court decide?

Petition permitted to be withdrawn; liberty to urge all contentions before the Debts Recovery Tribunal in pending Diary No.2086/2022, with the interim deposit condition (Rs.2,10,00,000/-) already complied with. ¶66

Parvathamma Narshimaiah Charitable Trust Vs the… — Banking and Recovery | Karnataka HC (2025)

What the court decided

AI extract

Outcome

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Issue for consideration

Whether the impugned order (Annexure-A) dated 18.04.2022 passed in Crl.Misc.No.218 of 2022 by the Hon'ble Prl. Senior Civil Judge & CJM, Mandya is contrary to Section 14(1) of the SARFAESI Act, 2002 and liable to be quashed/set aside.

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Ratio / Principle

The court permitted the petitioner to withdraw the writ petition, with liberty to urge all contentions before the Debts Recovery Tribunal in the pending Diary No.2086/2022.

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Key takeaways

It is for the respondent-bank to move the application before the DRT and seek expeditious disposal of the pending matter; if the respondent is not served, appropriate steps are to be taken by the bank itself to move the DRT.ratio¶64

Detailed headnote1 paragraphs

Karnataka HC (M. Nagaprasanna, J.), W.P. No.11956 of 2023 (GM-RES), disposed on 02.04.2025. Petitioners (a charitable trust/public school and two individuals) had sought quashing of the order dated 18.04.2022 in Crl.Misc.No.218/2022 passed by the Prl. Senior Civil Judge & CJM, Mandya, said to be contrary to Section 14(1) of the SARFAESI Act, 2002, arising from action by the Authorized Officer of Clix Capital Services Pvt. Ltd. (formerly GE Money Financial Services Pvt. Ltd.). An interim order of 12.06.2023 granted stay conditional on deposit of 30% of the demand (Rs.2,10,00,000/-) in three installments of Rs.70,00,000/- each; time was extended on 07.08.2023 and the deposit was completed. The challenge to the bank's Section 13(4) action was pending before the Debts Recovery Tribunal (Diary No.2086/2022). The petition was permitted to be withdrawn with liberty to urge all contentions before the DRT, and the bank was directed to move the DRT for expeditious disposal. No precedent was cited or considered on merits.

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NC: 2025:KHC:13762 WP No. 11956 of 2023

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IN THE HIGH COURT OF KARNATAKA AT BENGALURU

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DATED THIS THE 02^ND DAY OF APRIL, 2025

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BEFORE

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THE HON'BLE MR JUSTICE M.NAGAPRASANNA WRIT PETITION No.11956 OF 2023 (GM-RES)

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BETWEEN:

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PARVATHAMMA NARSHIMAIAH CHARITABLE TRUST GNANODAYA PUBLIC SCHOOL, 413-4, BELAVADI, BESIDE MIT ENGINEERING COLLEGE, NAGOONAHALLI POST, MANDYA, KARNATAKA-571 438.

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MR. SOMASHEKARAIAH RAJENDRA S/O. LATE SOMASHEKARAIAH, FLAT NO. G-7, GROUND FLOOR, D-4, 3^RD MAIN ROAD, YADAVAGIRI, MYSURU-570 020.

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Digitally signed by NAGAVENI Location: High Court of Karnataka

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MRS. B. G. GEETHA W/O. DR. RAJENDRA, FLAT NO. G-7, GROUND FLOOR, D-4, 3^RD MAIN ROAD, YADAVAGIRI, MYSURU-570 020.

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…PETITIONERS

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(BY SRI. RAJENDRA M A, ADVOCATE)

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AND:

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THE AUTHORIZED OFFICER M/S. CLIX CAPITAL SERVICES PVT. LTD., (FORMERLY KNOWN AS GE MONEY FINANCIAL SERVICES PVT. LTD.,) REGISTERED OFFICE AT 4^TH FLOOR, KAILASH BUILDING. KASTURBA GANDHI MARG,

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NC: 2025:KHC:13762 WP No. 11956 of 2023

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CONNAUGHT PLACE, NEW DELHI-110 001. IT’S A NON BANKING FINANCIAL COMPANYINCORPORATED UNDER THE COMPANIES ACT, 1956.

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(REPRESENTED BY ITS AUTHORIZED OFFICER MR. ATUL BANSAL)

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…RESPONDENT

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(BY SRI. B.V.SHANKAR NARAYAN RAO, SENIOR ADVOCATE FOR SRI CHANDRASHEKAR S N., ADVOCATE)

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THIS WRIT PETITION IS FILED UNDER ARTICLES 226 AND 227 OF THE CONSTITUTION OF INDIA PRAYING TO SET ASIDE THE IMPUGNED ORDER (ANNEXURE-A) DTD 18/04/2022 PASSED IN CRL. MISC.NO.218/2022 BY THE HONBLE PRL.SENIOR CIVIL JUDGE AND CJM, MANDYA, SINCE THE ORDER PASSED BY THE HONBLE JUDGE IS IN CONTRARY TO SEC 14(1) OF THE SARFAESI ACT 2002 AND ETC.,

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THIS PETITION, COMING ON FOR ORDERS, THIS DAY, ORDER WAS MADE THEREIN AS UNDER:

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CORAM: HON'BLE MR JUSTICE M.NAGAPRASANNA

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ORAL ORDER

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The petitioner is before this court seeking the following

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prayer:

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(a)Quash/set-aside the impugned order (Annexure-A) dated 18.-04.2022 passed in Crl.Misc.No.218 of 2022 by the Hon’ble Prl. Senior Civil Judge & CJM, Mandya, since the order passed by the Hon’ble Judge is in contrary to Section 14(1) of the SARFAESI ACT, 2002.”

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NC: 2025:KHC:13762 WP No. 11956 of 2023

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The co-ordinate benches of this Court from time to time have passed certain orders. On 12.06.2023, the following order is passed:

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“Issue emergent notice.

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Stay as prayed for is granted till next date of hearing subject to petitioner paying 30% of the amount in demand i.e., Rs.2,10,00,000/- (Rupees Two Crore Ten lakhs) only to respondent as under:

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(1) Rs.70,00,000/- (Rupees seventy lakh) only only within two weeks;

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(ii) Rs. 70,00,000/- (Rupees seventy lakh) only within next two weeks; and,

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(iii) the remainder i.e., Rs.70,00,000/- (Rupees seventy lakh) only within two weeks next following,

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failing which not only the interim order stands rescinded on its own but it will cast its shadow on the merits of the main matter too.”

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On 07.08.2023, the following order is passed:

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“ORDER ON IΑ ΝΟ.1/2023 AND IA NO.2/2023

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This court vide order dated 12.06.2023 had said as under:

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"Issue emergent notice.

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NC: 2025:KHC:13762 WP No. 11956 of 2023

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Stay as prayed for is granted till next date of hearing subject to petitioner paying 30% of the amount in demand i.e., Rs.2,10,00,000/-(Rupees Two Crore Ten lakhs) only to respondent as under:

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(i) Rs.70,00,000/- (Rupees seventy lakh) only within two weeks;

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(ii) Rs.70,00,000/- (Rupees seventy lakh) only within next two weeks; and,

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(iii) Rs.70,00,000/- (Rupees seventy lakh) only within two weeks next following,

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failing which not only the interim order stands rescinded on its own but it will cast its shadow on the merits of the main matter too."

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The learned counsel for the petitioner submits that the first installment has already been paid in terms of the above order and thus, bona fide having been shown, her client should be given one day for making the payment of second installment and two weeks for making the payment of third installment. This is vehemently opposed by learned counsel appearing for the Bank.

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Having heard the learned counsel for the parties and having perused the petition papers, this court is in agreement with the submission made on behalf of petitioner who has shown bona fide. Added, he offers to pay the second installment before the sun set of the day and the third installment within two weeks. A Writ court cannot act like a butcher; it has to act like a surgeon therefore, the contentions of the learned counsel for the Bank is rejected.

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In view of the above, the petitioner is granted time as sought for, with a warning that should he fail to comply with

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5 - NC: 2025:KHC:13762 WP No. 11956 of 2023

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this order, the petition itself stands rejected. If payment of second installment is made today, the Bank shall deliver back permissive occupation of the property to the petitioner forthwith retaining the mediate possession thereof with it.

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Call this matter after two weeks.”

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The learned counsel for the petitioner submits that the condition stipulated in the interim order for deposit of Rs.2,10,00,000/- has been complied with.

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Learned Senior Counsel Sri B.V. Shankar Narayan Rao, representing the finance submits that the matter is pending before the Debts Recovery Tribunal (‘DRT’ for short) where the challenge is to the notice issued under Section 13(4) of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002, (‘SARFAESI Act’ for short) and the matter is not being moved by the petitioner before the said Court on the strength of the pending matter before this Court.

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Sri M.A.Rajendra, learned counsel for the petitioner would submit that he would like to withdraw the petition in the light of the compliance with the interim order as also the fact that the

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NC: 2025:KHC:13762 WP No. 11956 of 2023

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entire issue is pending at large before the Debts Recovery Tribunal in a proceeding instituted by him challenging the order under Section 13(4) of the SARFAESI Act, by the bank.

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In that light, I deem it appropriate to permit the petitioner to withdraw the petition and urge all the contentions before the DRT in the pending Diary No.2086/2022.

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The learned Senior counsel submits that the matter is not

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being taken up by the Debts Recovery Tribunal.

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It is for the bank to move such application before the DRT and seek expeditious disposal in the matter. If the respondent is not served, appropriate steps be taken by the bank itself to move the DRT.

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With the aforesaid observations, the petition stands

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disposed of .

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Sd/(M.NAGAPRASANNA) JUDGE

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kcm

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List No.: 1 Sl No.: 3

Parvathamma Narshimaiah Charitable Trust v. the Authorized Officer

Case brief

What is this about?

What did the court decide?

Parvathamma Narshimaiah Charitable Trust v. the Authorized Officer

Case brief

What is this about?

What did the court decide?

Why is it important?

What the court decided

Issues for consideration

Statutes considered

Procedural history

Parties & counsel

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