Sri. Narayanaswamy. M Vs the Competent Authority — Karnataka HC (2026) — LawSathi Research

Sri. Narayanaswamy. M Vs the Competent Authority — Karnataka HC (2026) — LawSathi Research

What the court decided

AI extract

Outcome

Impugned order dated 23-9-2024 in Misc.No.667/2024 (XCI Addl. City Civil and Sessions Judge & Special Judge, KPIDFE Cases, Bengaluru) set aside; Competent Authority's Section 5(2) KPIDFE Act application remanded to the Special Court for fresh consideration after putting the appellants on notice; parties directed to appear before the Special Court on 30.07.2026 without further notice; all contentions of the parties left open.

Issue for consideration

Whether the Competent Authority's application under Section 5(2) of the KPIDFE Act was filed after an inordinate delay. +2 more

Ratio / Principle

The case involves disputed questions of fact and is a fit case where the matter requires consideration by the Special Court after putting the appellants on notice.

Key takeaways

Whether the interim attachment in respect of the appellants' property is to be made absolute requires consideration by the Special Court after putting the appellants on notice.ratio¶68
The appeal is allowed; the impugned order dated 23-9-2024 in Misc.No.667/2024 is set aside; the Competent Authority's application under Section 5(2) is remanded to the Special Court for fresh consideration.ratio¶69

Detailed headnote1 paragraphs

Karnataka Protection of Interest of Depositors in Financial Establishments Act, 2004 — Sections 5(2), 12(3) and 16 — Miscellaneous First Appeals under Section 16 by claimants to property under interim attachment in proceedings concerning M/s. TGS Constructions Pvt. Ltd., challenging the Special Court's order dated 23-9-2024 in Misc.No.667/2024 allowing the Competent Authority's Section 5(2) application — Contention: application filed after inordinate delay; appellants, claiming to be true owners, neither put on notice nor afforded a hearing — Competent Authority relies on paper publication, affixture of the interim order on the property, and the Section 12(3) right to file objections — Held: case involves disputed questions of fact; whether the interim attachment in respect of the appellants' property is to be made absolute requires consideration by the Special Court after putting the appellants on notice — Appeals allowed; impugned order set aside; Section 5(2) application remanded for fresh consideration; parties to appear before the Special Court on 30.07.2026 without waiting for notice; all contentions left open; order expressly declared non-precedential in view of the special facts of the case.

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NC: 2026:KHC:33903-DB MFA No. 9465 of 2025 C/W MFA No. 3150 of 2026

HC-KAR

IN THE HIGH COURT OF KARNATAKA AT BENGALURU

DATED THIS THE 3^RD DAY OF JULY, 2026

PRESENT

THE HON'BLE MRS. JUSTICE ANU SIVARAMAN AND

THE HON'BLE MR. JUSTICE VENKATESH NAIK T MISCELLANEOUS FIRST APPEAL NO.9465 OF 2025 (KPIDFA)

C/W

MISCELLANEOUS FIRST APPEAL NO.3150 OF 2026 (KPIDFA)

IN MFA NO.9465/2025

BETWEEN:

SRI MOHAN KUMAR B. S/O. LATE BACHE GOWDA AGED ABOUT 39 YEARS RESIDING AT NO.20, 4TH CROSS 1ST MAIN ROAD, MUNESHWARA LAYOUT ATTURU, YELAHANKA BENGALURU-560 064.

Digitally signed by RAKSHA Location: High Court of Karnataka

(BY SRI VEERESH MAHESH UPPIN, ADVOCATE)

AND:

THE COMPETENT AUTHORITY FOR M/S. TGS CONSTRUCTIONS PVT. LTD. ADDITIONAL REGIONAL COMMISSIONER OFFICE OF THE REGIONAL COMMISSIONER BENGALURU DIVISION BMTC BUILDING, 2ND FLOOR K.H. ROAD, SHANTHINAGAR BENGALURU-560 083.

…APPELLANT

M/S. TGS CONSTRUCTIONS PVT. LTD., REPRESENTED BY ITS MANAGING DIRECTOR SMT. MANDEEP KAUR 2ND MAIN, 4TH CROSS,

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NC: 2026:KHC:33903-DB MFA No. 9465 of 2025 C/W MFA No. 3150 of 2026

HC-KAR

NO.97/A EKALAVYA GRUHA J.P. NAGAR, 8TH PHASE JAMBOOSAVARI, KOTHANUR DINNE BENGALURU SOUTH-560 083.

SMT. MANDEEP KAUR W/O. SACHIN NAIK RESIDING AT NO.97/A EKALAVYA GRUHA 2ND MAIN, 4TH CROSS J. P. NAGAR, 8TH PHASE JAMBOOSAVARI, KOTHANUR DINNE BENGALURU SOUTH-560 083.

MR. RAMANTH SHETTY S/O. LATE SRI NARAYANA SHETTY AGED ABOUT 60 YEARS RESIDING AT NO.18, 2ND MAIN 2ND CROSS, GUPTA LAYOUT ADUGODI POST BENGALURU-560 030.

…RESPONDENTS

(BY SRI VEERESH R. BUDIHAL, ADVOCATE FOR R-1; VIDE COURT ORDER DATED 30-1-2026 NOTICE TO R-2 TO R-4 IS DISPENSED WITH)

THIS MISCELLANEOUS FIRST APPEAL IS FILED UNDER SECTION 16 OF THE KARNATAKA PROTECTION OF INTEREST OF DEPOSITORS IN FINANCIAL ESTABLISHMENTS ACT, 2004, PRAYING TO SET ASIDE THE ORDER DATED 23-9-2024 PASSED IN MISC.NO.667 OF 2024 ON THE FILE OF THE XCI ADDITIONAL CITY CIVIL AND SESSIONS JUDGE AND SPECIAL JUDGE FOR KPIDFE CASES, BENGALURU (CCH-92), ALLOWING THE PETITION FILED UNDER SECTION 5(2) OF THE KPIDFE ACT-2004.

IN MFA NO.3150/2026

BETWEEN:

SRI NARAYANASWAMY M. S/O. CHIKKAMUNISHAMAPPA

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HC-KAR

AGED ABOUT 68 YEARS RESIDING AT DODDASANNE VILLAGE DEVANAHALLI TALUK BENGALURU-562 110.

SMT. N. MALA D/O. NARAYANASVAMY M. AGED ABOUT 38 YEARS RESIDING AT DODDASANNE VILLAGE DEVANAHALLI TALUK BENGALURU-562 110.

SMT. RAJESHWARI N. D/O. NARAYANASVAMY M. AGED ABOUT 29 YEARS RESIDING AT DODDASANNE VILLAGE DEVANAHALLI TALUK BENGALURU-562 110.

SRI ABHILASH N. S/O. NARAYANASVAMY M. AGED ABOUT 25 YEARS RESIDING AT DODDASANNE VILLAGE DEVANAHALLI TALUK BENGALURU-562 110.

...APPELLANTS

(BY SRI K. CHANDRANATH ARIGA, ADVOCATE)

AND:

THE COMPETENT AUTHORITY FOR M/S. TGS CONSTRUCTIONS PVT. LTD. ADDITIONAL REGIONAL COMMISSIONER OFFICE OF THE REGIONAL COMMISSIONER BENGALURU DIVISION BMTC BUILDING 2ND FLOOR K.H. ROAD, SHANTHINAGAR BENGALURU-560 083.

M/S. TGS CONSTRUCTIONS PVT. LTD., REPRESENTED BY ITS MANAGING DIRECTOR SMT. MANDEEP KAUR 2ND MAIN, 4TH CROSS NO.97/A EKALAVYA GRUHA J.P. NAGAR, 8TH PHASE JAMBOOSAVARI, KOTHANUR DINNE

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HC-KAR

BENGALURU SOUTH-560 083.

SMT. MANDEEP KAUR W/O. SACHIN NAIK RESIDING AT NO.97/A EKALAVYA GRUHA 2ND MAIN, 4TH CROSS J. P. NAGAR, 8TH PHASE JAMBOOSAVARI, KOTHANUR DINNE BENGALURU SOUTH-560 083.

MR. RAMANTH SHETTY S/O. LATE SRI NARAYANA SHETTY AGED ABOUT 60 YEARS RESIDING AT NO.18, 2ND MAIN 2ND CROSS, GUPTA LAYOUT ADUGODI POST BENGALURU-560 030.

...RESPONDENTS

(BY SRI VEERESH R. BUDIHAL, ADVOCATE FOR R-1; VIDE COURT ORDER DATED 15-6-2026, NOTICE TO R-2 TO R-4 IS DISPENSED WITH)

THIS MISCELLANEOUS FIRST APPEAL IS FILED UNDER SECTION 16 OF THE KARNATAKA PROTECTION OF INTEREST OF DEPOSITORS IN FINANCIAL ESTABLISHMENTS ACT, 2004, PRAYING TO SET ASIDE THE ORDER DATED 23-9-2024 PASSED IN MISC.NO.667 OF 2024 ON THE FILE OF THE XCI ADDITIONAL CITY CIVIL AND SESSIONS JUDGE, AND SPECIAL JUDGE FOR KPIDFE CASES, BENGALURU, CCH-92, ALLOWING THE PETITIONS FILED UNDER SECTION 5(2) OF THE KPIDFE ACT,2004 WITH COST OF RS.2,000/-.

THESE MISCELLANEOUS FIRST APPEALS, COMING ON FOR ORDERS, THIS DAY, JUDGMENT WAS DELIVERED THEREIN AS UNDER:

CORAM: HON'BLE MRS. JUSTICE ANU SIVARAMAN and HON'BLE MR. JUSTICE VENKATESH NAIK T

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HC-KAR

ORAL JUDGMENT

(PER: HON'BLE MRS. JUSTICE ANU SIVARAMAN)

We have heard the learned counsel for the appellants and

the learned counsel appearing for the Competent Authority in both the matters.

Learned counsel for the appellants submits that the order passed by the Special Court on the application filed by the Competent Authority under Section 5(2) of the Karnataka Protection of Interest of Depositors in Financial Establishments Act, 2004 (for short, "the KPIDFE Act"), is bad in law on various grounds.

It is contended that the application under Section 5(2) was filed after an inordinate delay. It is further contended that the appellants, who are the true owners of the property, were neither put on notice nor afforded an opportunity of hearing before the order was passed.

Learned counsel for the appellants submits that the appellants have serious contentions on facts to be raised in the matter and that the matter may be remanded for fresh

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HC-KAR

consideration by the Special Court after hearing the appellants as well.

The learned counsel for the respondent-Competent Authority contends that the factum of the initial attachment was intimated to the public at large by way of a paper publication and that the interim order of attachment was also affixed to the property. It is further contended that, in terms of Section 12(3) of the KPIDFE Act, even if no notice is served, it is open to the affected parties to approach the Special Court and file their objections, if any.

Having considered the contentions advanced, we notice that this case involves disputed questions of fact and that this is a fit case where the question as to whether the interim attachment in respect of the appellants' property is to be made absolute requires consideration by the Special Court after putting the appellants on notice.

In the above view of the matter, the appeal is allowed . The impugned order is set aside. The application filed by the Competent Authority under Section 5(2) is remanded to the Special Court for fresh consideration.

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NC: 2026:KHC:33903-DB MFA No. 9465 of 2025 C/W MFA No. 3150 of 2026

HC-KAR

Without waiting for any further notice, the parties shall appear before the Special Court on 30.07.2026.

It is made clear, that it is only in view of the special facts of the instant case, the disputed questions of fact which arises herein that the matter is being remanded for fresh consideration, and this order shall not be treated as a precedent in other cases.

All contentions of the parties are left open.

Sd/(ANU SIVARAMAN) JUDGE

Sd/(VENKATESH NAIK T) JUDGE

List No.: 3 Sl No.: 6

AM