M/S P S N Mines and Minerals Vs M/S Pridhvi Asset… — Company and Corporate | Karnataka HC (2025)

M/S P S N Mines and Minerals Vs M/S Pridhvi Asset… — Company and Corporate | Karnataka HC (2025)

What the court decided

AI extract

Outcome

None; both petitions were disposed of without quashing the impugned notices. The Court declined Article 226 interference, directed the petitioners to pursue remedies permissible in law, and left the crediting of the Rs.2.7 Crores deposit towards principal to the underlying proceedings, subject to the secured creditor's defence.

Issue for consideration

Whether there is cause for exercise of writ jurisdiction under Article 226 of the Constitution of India to interfere with the proclamation of sale dated 19.08.2024 and the connected recovery/SARFAESI proceedings. +2 more

Court's answer

No cause is made for exercise of jurisdiction under Article 226 of the Constitution of India; there is no reason for interference with the impugned sale proclamation and connected recovery action.

Ratio / Principle

The petitioners, if aggrieved, must avail their remedy as would be permissible in law (the first respondent's counsel having indicated the Section 18 SARFAESI route, if open to the guarantor-petitioner).

Key takeaways

The petitioners' request to treat the deposit of Rs.2.7 Crores as part of the principal amount is an aspect that must be considered in the proceedings initiated by them, subject to the secured creditor's defence against such request.ratio¶66

Detailed headnote1 paragraphs

Karnataka High Court (B M Shyam Prasad, J.), oral order dated 11 August 2025, in W.P. No.25953/2024 (GM-DRT) c/w W.P. No.15793/2025 (GM-RES). The borrower/guarantor petitioners (M/s. P S N Mines and Minerals, M/s. A.R. Metallurgicals Pvt. Ltd., Parveez Rahim Khan and Suhaa Parveez) challenged the proclamation of sale cum e-auction sale notice dated 19.08.2024 issued by the Recovery Officer-II, DRT-I Bengaluru in RC No.14168/2018 in OA No.338/2014, issued pursuant to a Recovery Certificate under the Recovery of Debts and Bankruptcy Act, 1993. Guarantor Nasreen Taj Rahim, who had mortgaged her property, separately challenged an eviction notice dated 23.05.2025 issued by secured creditor Pridhvi Asset Reconstruction; she had earlier questioned the DRT's orders in S.A. No.2/2020 under Section 17 SARFAESI Act, assailing the Section 13(4) sale notice. The petitioners had deposited Rs.2.7 Crores inter se and sought its credit towards principal; their One Time Settlement request stood rejected. Holding that no cause was made for exercise of Article 226 jurisdiction, the Court declined interference, observed that aggrieved petitioners must avail remedies permissible in law (counsel for the creditor pointing to the Section 18 SARFAESI remedy, if open), and left the deposit-credit question to the underlying proceedings subject to the secured creditor's defence. It was recorded that no sale had been conducted under the impugned proclamation. Both petitions stood disposed of; no relief was granted.

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NC: 2025:KHC:30936 WP No. 25953 of 2024 C/W WP No. 15793 of 2025

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IN THE HIGH COURT OF KARNATAKA AT BENGALURU

DATED THIS THE 11^TH DAY OF AUGUST, 2025

BEFORE

THE HON'BLE MR. JUSTICE B M SHYAM PRASAD

WRIT PETITION NO.25953 OF 2024 (GM-DRT) C/W WRIT PETITION NO.15793 OF 2025 (GM-RES)

IN WP NO.25953/2024:

BETWEEN:

M/S. P S N MINES AND MINERALS A PARTNERSHIP FIRM HAVING ITS PLACE OF BUSINESS AT NO.204-A, 2^ND FLOOR NO.136, CEARS PLAZA, RESIDENCY ROAD BENGALURU - 560 025 (REPRESENTED HEREIN BY ONE OF ITS PARTNERS VIZ., MR. PARVEEZ RAHIM KHAN)

Digitally signed by VANAMALA N Location: HIGH COURT OF KARNATAKA

M/S. A.R. METALLURGICALS PVT. LTD., A COMPANY INCORPORATED UNDER THE COMPANIES ACT, 1956, HAVING ITS ADMINISTRATIVE OFFICE AT NO.202-A, 2^ND FLOOR, 136, CEASERS PLAZA, RESIDENCY ROAD BENGALURU - 560 025 (REPRESENTED HEREIN BY ITS MANAGING DIRECTOR - MR. PARVEEZ RAHIM KHAN)

MR. PARVEEZ RAHIM KHAN S/O ABDUL RAHIM KHAN AGED AROUND 64 YEARS

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MRS. SUHAA PARVEEZ W/O MR. PARVEEZ RAHIM KHAN AGED AROUND 55 YEARS

PETITIONERS NO.3 AND 4 ARE RESIDING AT NO.103, 1^ST FLOOR, EXPRESS APARTMENTS, 134-35 RICHMOND ROAD BENGALURU-560 025.

…PETITIONERS

(BY SRI. NAMAN JHABAKH, ADVOCATE FOR SRI. VIVEK HOLLA, ADVOCATE)

AND:

M/S. PRIDHVI ASSET RECONSTRUCTIONS AND SECURITISATION COMPANY LTD., HAVING ITS OFFICE AT NO.1-55, 4TH FLOOR, RAJA PRAASADAMU MASJID ROAD, KONDAPUR HYDERABAD - 500 084.

THE RECOVERY OFFICER - II DEBT RECOVERY TRIBUNAL -I TELEPHONE HOUSE RAJBHAVAN ROAD BENGALURU - 560 001.

…RESPONDENTS

(BY SRI. FRANCIS XAVIER, ADVOCATE FOR R1; R2 - SERVED)

THIS WRIT PETITION IS FILED UNDER ARTICLES 226 AND 227 OF THE CONSTITUTION OF INDIA PRAYING TO QUASHING THE PROCLAMATION OF SALE CUM E AUCTION SALE NOTICE DATED 19.08.2024 ISSUED BY THE R-2 IN RC NO.14168/2018 IN OA NO.338/2014(ANNX-P) AND THE REGULATIONS

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THERETO (ANNX-Q) FOR THE SALE OF THE SCHEDULE PROPERTY.

IN WP NO.15793/2025:

BETWEEN:

MRS. NASREEN TAJ RAHIM AGED ABOUT 65 YEARS W/O DR. IQBAL AHMED NO.780, 12^TH MAIN, 1^ST CROSS HAL II STAGE, INDIRANAGAR BENGALURU-560038.

...PETITIONER

(BY SMT. SIRI RAJASHEKAR, ADVOCATE)

AND:

M/S. PRIDHVI ASSET RECONSTRUTION AND SECURITISATION COMPANY LTD., HAVING ITS OFFICE AT NO.1-55 4^TH FLOOR, RAJA PRAASADAMU MASJID ROAD, KONDAPUR HYDERABAD-500 084 [UNDER REGULAR COMPANY ACT] REP. BY ITS MANAGER.

MR. PARVEEZ RAHIM KHAN S/O ABDUL RAHIM KHAN AGED AROUND 64 YEARS

MRS. SUHAA PARVEEZ W/O MR. PARVEEZ RAHIM KHAN AGED AROUND 55 YEARS

PETITIONERS NO.2 AND 3 ARE R/AT NO.103, 1^ST FLOOR EXPRESS APARTMENTS 134-35, RICHMOND ROAD BENGALURU-560 025.

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...RESPONDENTS

(BY SRI. FRANCIS XAVIER, ADVOCATE FOR C/R1; R2 - SERVED)

THIS WRIT PETITION IS FILED UNDER ARTICLE 226 OF THE CONSTITUTION OF INDIA PRAYING TO QUASH THE EVICTION NOTICE DATED 23.05.2025 ISSUED BY THE R1 REF.NO.251/2025/280 VIDE ANNEXURE -E. AND TO GRANT AN INTERIM ORDER TO STAY THE OPERATION OF THE IMPUGNED EVICTION NOTICE DATED 23.05.2025 (ANNEXURE-E) AND ALL FURTHER ACTION WITH RESPECT TO THE SCHEDULE PROPERTY.

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

CORAM: HON'BLE MR. JUSTICE B M SHYAM PRASAD

ORAL ORDER

The petition in W.P. No.25953 of 2024 is by the borrowers and the guarantors calling in question the proclamation of sale dated 19.08.2024. This proclamation of sale is issued pursuant to the Recovery Certificate issued under the Recovery of Debts and Bankruptcy Act, 1993. The petitioner in W.P. No.15793/2025 is one of the guarantors who

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has secured the loans availed by the other petitioners creating mortgage for her property and she has called in question the orders of the Debt Recovery Tribunal [DRT] under Section 17 of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 [SARFAESI Act] in S. A. No.2/2020. This petitioner in S. A. No.2/2020 has also assailed the sale notice under Section 13(4) of the SARFAESI Act.

Mr. Naman Jhabakh, the learned counsel for the petitioners in W.P.No.25953/2024, submits that the petitioner's inter se have deposited Rs.2.7 Crores to ensure that there is no precipitation either under the Recovery Certificate or under the SARFAESI Act, that this amount must be credited towards the principal before any action is taken. Mr. Francis Xavier, the learned counsel for the first respondent [ the secured creditor and the beneficiary of the Recovery Certificate ], submits that:

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[a] no sale is conducted under the

impugned proclamation of sale,

[b] the petitioner in W.P. No.15793/2025, even if aggrieved by the DRT's order in S.A. No.2/2020, must avail remedy under Section 18 of the SARFAESI Act, if it is open to her.

[c] the amount recoverable by the secured creditor has already crystallized, and as such, Rs.2.7 Crores cannot be given credit towards the principal amount.

These submissions are considered as also the submissions made on the previous hearing date viz . 30.07.2025 as regards the petitioners' request for One Time Settlement and the rejection thereof.

This Court is of the opinion that there is no reason for interference as no cause is made for exercise of jurisdiction under Article 226 of the

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Constitution of India, and the petitioners, if aggrieved, must avail their remedy as would be permissible in law. This Court must also observe that, insofar as the petitioners' request to treat the deposit of Rs.2.7 Crores as part of the principal amount, is an aspect that must be considered in the proceedings initiated by them subject to the secured creditor's defence as against such request.

The petitions stand disposed of accordingly subject to all just exceptions and law.

SD/(B M SHYAM PRASAD) JUDGE

RB