Disposed¶69

Girish J., v. State Bank of India

Karnataka HC2 Sept 2025WP/16813/2025

Case brief

AI extract

What is this about?

SARFAESI Section 14 magistrate proceedings (order dt. 25.03.2025, Crl.Misc. 9152/2024, XLI Addl. CJM Bengaluru) challenged by writ of claimed tenant-in-possession; HC leaves tenancy question to pending DRT application under Section 17 SARFAESI remedy; concerns over Bank officer's 'no tenant' Para 20 affidavit dt. 17.09.2024; direction for internal examination within SBI SARB hierarchy under Service Regulations and report to DRT; petition disposed.

What did the court decide?

Petition disposed without quashing the impugned order dated 25.03.2025; directions confined to (i) leaving the question of the petitioner's tenancy to the pending DRT application and (ii) examination of the 17.09.2024 affidavit statement within the respondent-Bank's hierarchy subject to its Service Regulations, with the report placed in the pending proceedings before the DRT.

Girish J., Vs State Bank of India — Banking and Recovery | Karnataka HC (2025)

What the court decided

AI extract

Outcome

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Issue for consideration

Whether the petitioner is a tenant in possession of the subject property - a question the Court holds must be considered by the Debt Recovery Tribunal (DRT) in the pending application, and not in these writ proceedings. +1 more

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Court's answer

At this stage the Court cannot accept the affidavit filed in the proceedings under Section 14 of the SARFAESI Act stating that no tenant is in possession of the premises; whether the petitioner is a tenant must be considered by the DRT in the pending application, and no observation can be made in the present proceedings lest the efficacy of those proceedings is affected.

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Ratio / Principle

Because the Bank avails extraordinary remedies under the provisions of the SARFAESI Act, its officers must be diligent and ensure that there is no hint of any error in the statements made in the proceedings contrary to the fact.

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Key takeaways

Whether the statement in the affidavit dated 17.09.2024 falls under that category must be examined within the respondent-Bank's hierarchy subject to its Service Regulations, and the report placed in the pending proceedings before the DRT.ratio¶63

Detailed headnote1 paragraphs

High Court of Karnataka (B M Shyam Prasad, J.), WP No. 16813 of 2025 (GM-RES), decided 02.09.2025 - SARFAESI. An occupant claiming to be a tenant in possession challenged the order dated 25.03.2025 of the XLI Addl. Chief Judicial Magistrate, Bengaluru in Crl.Misc.No.9152/2024 (proceedings under Section 14 of the SARFAESI Act). By order dated 17.06.2025 the petitioner had been relegated to the Section 17 SARFAESI remedy before the DRT, where his application pends, and the Bank's deponent was directed to answer the Para 20 assertion (affidavit dated 17.09.2024) that no tenant occupied the schedule property. The Bank's Chief Manager (Nagraja V) affirmed bona fide belief, denied swearing a false affidavit, and relied on his 26.06.2024 visit for symbolic possession under Section 13(4) when the premises were found locked. Holding: (i) the tenancy question lies with the DRT in the pending application and no observation will be made in the writ lest its efficacy be affected; (ii) officers of a Bank availing extraordinary SARFAESI remedies must ensure no hint of statements contrary to fact; (iii) whether the 17.09.2024 statement is contrary to fact shall be examined within the Bank's hierarchy under its Service Regulations and reported to the DRT. Petition disposed accordingly.

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NC: 2025:KHC:34832 WP No. 16813 of 2025

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HC-KAR

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IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 2^ND DAY OF SEPTEMBER, 2025

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BEFORE

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THE HON'BLE MR. JUSTICE B M SHYAM PRASAD WRIT PETITION NO. 16813 OF 2025 (GM-RES)

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BETWEEN:

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Digitally signed by VANAMALA N Location: HIGH COURT OF KARNATAKA

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GIRISH J., S/O LATE JANARADHANA RAJU, AGED ABOUT 48 YEARS, R/AT PREMISES BEARING AT TIRUMALA RESIDENCY, NO. 764/112/2 FLAT NO. 103, 1ST FLOOR, JAKKUR MAIN ROAD, BEHIND JAKKUR AERODROME, JAKKUR, BENGALURU 560064.

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…PETITIONER

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(BY SRI. BOLA VEDVYAS SHENOY.,ADVOCATE)

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AND:

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STATE BANK OF INDIA STRESSED ASSETS RECOVERY BRANCH (SARB) NO. 11/90, 3RD FLOOR, NEAR OLD SHIVAJI THEATRE,

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NC: 2025:KHC:34832 WP No. 16813 of 2025

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HC-KAR

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J C ROAD, BENGALURU 560 002. REP BY ITS AUTHORIZED OFFICER/ CHIEF MANAGER.

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MR VENKATESHWARA RAO S/O YARAMMA RAO,

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MRS J PADMAVATHI D/O SUBBA RAO

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BOTH R2 AND R3 ARE R/AT NO. 7, 2ND FLOOR, NARAYANAPPA LAYOUT HEBBAL, KEMPAPURA, SUMA PUBLIC SCHOOL, BENGALURU 560 024

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ALSO AT C/O PADMAVATHI ENTERPRISE, NO. 7, GROUND FLOOR NARAYANAPPA LAYOUT, HEBBAL KEMPAPURA, SUMA PUBLIC SCHOOL, BENGALURU 560024

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ALSO AT SRI BALAJI ELEVATORS AND BOREWELLS SERVICE, NO. 7, GROUND FLOOR, NARAYANAPPA LAYOUT, HEBBAL KEMPAPURA, SUMA PUBLIC SCHOOL, BENGALURU 560 024

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ALSO AT MR VENKATESHWAR RAO, NO. 25, SRI VENKATESHWARA NILAYA, VAYUNANDANA LAYOUT, HEBBAL KEMPAPURA,

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3 - NC: 2025:KHC:34832 WP No. 16813 of 2025

HC-KAR

BENGALURU 560 024.

…RESPONDENTS

(BY SRI. VINAY SWAMY C.,ADVOCATE FOR R1)

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THIS WP IS FILED UNDER ARTICLES 226 AND 227 OF THE CONSTITUTION OF INDIA PRAYING TO QUASH ORDER DATED 25.03.2025 IN CRIMINGAL MISC. NO. 9152/2024 PASSED BY THE XLI ADDL. CHIEF MAGISTRATE BENGALURU AND CONSEQUENTLY QUASH THE ENTIRE PROCEEDINGS IN CRIMINAL MISC NO. 9152/2024 IN THE FILE OF THE XLI ADDL. CHIEF JUDICIAL MAGISTRATE BENGALURU; RESTRAIN THE RESPONDENTS THEIR REPRESENTATIVE SUCCESSORS LEGAL ASSIGNEES OR ANY PERSON CLAMMING UNDER THEM OR ACTING UNDER INSTRUCTIONS FROM DISPOSSESSING THE PETITIONER FROM THE SCHEDULE PROPERTY WITHOUT FOLLOWING DUE PROCESS OF LAW.

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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 B M SHYAM PRASAD

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NC: 2025:KHC:34832 WP No. 16813 of 2025

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HC-KAR

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ORAL ORDER

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The petitioner has called in question the order dated 25.03.2025 in Crl.Misc.No.9152/2024 on the file of the XLI Additional Chief Judicial Magistrate, Bengaluru. This Court, on 17.06.2025, has opined that the petitioner must be relegated to avail statutory remedy under Section 17 of the Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 [for short, 'the SARFAESI Act' ].

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Mr. Bola Vedvyas Shenoy, the learned counsel for the petitioner, submits that in terms of this Court's observation in the order dated 17.06.2025, the petitioner has already availed the statutory remedy. The next aspect that should be considered stems from this Court's further observations in the order dated 17.06.2025. This Court, while considering the petitioner's assertion that he was a tenant in possession of the subject

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NC: 2025:KHC:34832 WP No. 16813 of 2025

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HC-KAR

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property, has opined that the deponent, who has sworn to an affidavit on behalf of the respondent - Bank in the proceedings under Section 14 of the SARFAESI Act, must file an affidavit as regards the assertion made in such affidavit. The Court, in issuing this direction has referred to Paragraph No.20 of the affidavit dated 17.09.2024 which reads as under:

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"The applicant further submit that no tenant are in the below mentioned schedule property. Further, it is the self-occupation of the borrower himself."

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In terms of this Court's order, Mr. Nagraja V, the Chief Manager with the respondent - Bank has filed an affidavit and the relevant part of this affidavit reads as under:

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" I submit that the contents of Para 20 of the affidavit sworn before the learned Magistrate are on the Bonafide belief that the mortgagor/borrower is in possession since I had no information of the alleged tenant. I

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NC: 2025:KHC:34832 WP No. 16813 of 2025

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HC-KAR

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respectfully submit that I have not sworn to a false affidavit before the Magistrate Court.

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I submit, that I personally visited the mortgaged schedule property on 26.06.2024 for taking symbolic possession of the property u/s 13(4) of SARFAESI Act 2002 by affixing the possession notice on the secured asset. The door was locked and there was no one to respond to me. Even after due enquiries, there was no information about this alleged tenant being in occupation of the mortgaged property. The copies of the photograph of affixure is herewith produced."

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4. If Mr. Bola Vedvyas Shenoy seeks for

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further orders in the light of the afore while stating that the statements made in terms of this Court's order is false, Mr. Sri Vinay Swamy C, the learned counsel for the respondent - Bank, submits that this Court cannot take any exception with the statement made in the affidavit dated 17.09.2024 because:

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7 - NC: 2025:KHC:34832 WP No. 16813 of 2025

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HC-KAR

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[a] the respondent - Bank, unless the ingredients under Section 17(4A) of the SARFAESI Act are established, cannot recognize any person as a tenant ,

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[b] the proceedings under Section 14 of the SARFAESI Act would only be akin to the ministerial act as is held by the different Courts, and in such proceedings, the concerned Courts or the Authorities will not adjudicate on any claim of tenancy, and

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[c] the petitioner relies upon a decree in a collusive suit to bolster his case that he is in possession of the subject property as a tenant. Mr. Vinay Swamy C. submits that these are salient and unassailable.

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The petitioner’s case is that he is in

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possession of the subject property as a tenant. This

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8 - NC: 2025:KHC:34832 WP No. 16813 of 2025

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HC-KAR

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Court, at this stage, cannot accept the affidavit filed in the proceedings under Section 14 of the SARFAESI

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Act stating that no tenant is in possession of the premises. The question, whether the petitioner is a tenant is a question that must be considered by the Debt Recovery Tribunal [DRT] in the pending application, and that no observation can be made in the present proceedings, lest the efficacy of those proceedings are affected.

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This Court is of the opinion that the officers of the Bank, because the Bank avails extraordinary remedies under the provisions of the SARFAESI Act, must be diligent and ensure that there is no hint of any error in the statements made in the proceedings contrary to the fact, and further, this Court is of the view that whether this statement in the affidavit on 17.09.2024 falls under this category must be examined within the respondent - Bank's hierarchy subject to its Service Regulations

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NC: 2025:KHC:34832 WP No. 16813 of 2025

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HC-KAR

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and the report placed in the pending proceedings

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before the DRT.

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The petition stands disposed of accordingly.

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