Partly allowed

Sunil H C v. the Special Officer and Competent Authority

Karnataka HC30 Jan 2026WP/37704/2025

Case brief

AI extract

What is this about?

The High Court of Karnataka quashed an Endorsement rejecting a depositor’s adjudication claim as perfunctory and devoid of reasons. The Court directed the first respondent to reconsider the claim within eight weeks and allowed the petitioner to file a representation.

What did the court decide?

Impugned Endorsement quashed; Petitioner’s application for reconsideration restored; First respondent directed to communicate decision under Section 7(2) within eight weeks.

Sunil H C Vs the Special Officer and Competent Authority — Consumer Protection | Karnataka HC (2026)

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NC: 2026:KHC:5324 WP No. 37704 of 2025

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HC-KAR

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IN THE HIGH COURT OF KARNATAKA AT BENGALURU

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DATED THIS THE 30^TH DAY OF JANUARY, 2026

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BEFORE

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THE HON'BLE MR. JUSTICE B M SHYAM PRASAD WRIT PETITION NO. 37704 OF 2025 (GM-RES)

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BETWEEN:

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SUNIL H C S/O. CHANDRASHEKAR H.S. AGED ABOUT 33 YEARS, 4107/1. 10TH CROSS, 2ND A MAIN ROAD, SBM COLONY, BENGALURU 560050

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…PETITIONER

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(BY SRI. G. BALAKRISHNA SHASTRY, ADVOCATE)

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Digitally signed by VANAMALA N Location: HIGH COURT OF KARNATAKA

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AND:

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THE SPECIAL OFFICER

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AND COMPETENT AUTHORITY, 3RD AND 4TH FLOOR, PODIUM BLOCK, V.V. TOWER, DR. AMBEDKAR VEEDHI, BENGALURU 560 001

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SREE VASHISTA CREDIT SAUHARDA SAHAKARI LIMITED. REPRESENTED BY ITS ADMINISTRATOR C/O. JOINT REGISTRAR OF CO-OPERTIVE SOCIETY,

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NC: 2026:KHC:5324 WP No. 37704 of 2025

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HC-KAR

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BENGALURU DIVISION, NO. 146, SAHAKARA SOUDHA, 3RD FLOOR, 8TH CROSS, MARGOSA ROAD, MALLESWARAM, BENGALURU 560 003.

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…RESPONDENTS

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(BY SRI. VEERESH R. BUDIHAL, ADVOCATE FOR R1;

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V/O. DTD 23.01.2026 NOTICE TO R2 IS DEFERRED)

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THIS WP IS FILED UNDER ARTICLE 226 OF THE CONSTITUTION OF INDIA PRAYING ISSUE A WRIT OF CERTIORARI OR ANY OTHER WRIT QUASHING THE ENDORSEMENT DATED 16.01.2025 IN NO.SPLOCA/CLAIM/P-GRIV/35/2024-25 ISSUED BY THE 1ST RESPONDENT PRODUCED AT ANNEXURE-A; ISSUE A WRIT OF MANDAMUS OR ANY OTHER WRIT DIRECTING THE 1ST RESPONDENT TO MAKE PAYMENT OF THE PRINCIPAL AMOUNT AND THE INTEREST DUE ON THE CUMULATIVE DEPOSIT AND F.D. RECEIPTS DETAILED IN PARA--OF THE WRIT PETITION VIDE THE RECEIPT PRODUCED AT ANNEXURE B TO M; ISSUE A WRIT OF MANDAMUS OR ANY OTHER WRIT DIRECTING THE 1ST RESPONDENT TO MAKE PAYMENT OF RS.1,47,914/- LYING IN THE S.B. ACCOUNT NO.001001001 1401 IN THE SREE VASHISTA CREDIT SOUDHARDHA LIMITED PRODUCED AT ANNEXURE-N.

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

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NC: 2026:KHC:5324 WP No. 37704 of 2025

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HC-KAR

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

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ORAL ORDER

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The petitioner is a depositor whose request for adjudication of claims under Section 7(2) of the Karnataka Protection of Interest of Depositors in Financial Establishments Act, 2004 [for short, ' the Act of 2004' ] is rejected by the Endorsement dated 16.01.2025. The first respondent has issued this Endorsement informing the petitioner that his claim is not supported by verifiable proof as contemplated under Section 7(2) of the Act of 2004.

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This Court, on 23.01.2026 upon hearing Mr. G. Balakrishna Shastry, the learned counsel for the petitioner, has called upon Mr. Veeresh Budihal, the learned standing counsel for the first respondent to secure instructions on whether it would be permissible for the petitioner to approach the Special Court under the Act of 2004.

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NC: 2026:KHC:5324 WP No. 37704 of 2025

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HC-KAR

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Mr. Veeresh R. Budihal, the learned

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counsel submits that the appellate remedy under Section 16 of the Act of 2004 would be available only when there is an order of the Special Court under Section 5 or Section 13 thereof, and if the petitioner makes out a case for interference with the impugned Endorsement, this Court could interfere to direct the first respondent to reconsider the claim.

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Mr. G. Balakrishna Shastry submits that

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the petitioner, upon furnishing all the documents in the prescribed form [ Annexure - P ], is served with the Communication dated 07.11.2024 [ Annexure - Q ], that the first respondent has called upon the petitioner by this Communication to furnish notarized NOC from his sister because of the arrangement under which the deposit was made; that the petitioner has also filed such affidavit on the very next day; and that despite these circumstances, the

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NC: 2026:KHC:5324 WP No. 37704 of 2025

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HC-KAR

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first respondent has perfunctorily issued the

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Endorsement without assigning reasons.

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Mr. Veeresh R. Budihal is heard in the

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light of these circumstances as well. This Court is of the opinion that the first respondent should have reasoned why the petitioner's claim is not proved as required under Section 7(2) of the Act of 2004 instead of perfunctorily issuing the Endorsement. In the light of the afore, the following:

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ORDER

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[a] The petition stands disposed of quashing the impugned Endorsement dated 16.01.2025, restoring the petitioner's application for reconsideration.

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[b] The petitioner will be at liberty to file

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a certified copy of this order and another representation with the first respondent.

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NC: 2026:KHC:5324 WP No. 37704 of 2025

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HC-KAR

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[c] The first respondent, within eight [8] weeks from the date of receipt of a certified copy of this Court's order, shall communicate the decision under Section 7(2) of the Act of 2004.

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SD/(B M SHYAM PRASAD) JUDGE

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Sunil H C v. the Special Officer and Competent Authority

Case brief

What is this about?

What did the court decide?

Sunil H C v. the Special Officer and Competent Authority

Case brief

What is this about?

What did the court decide?

What the court decided

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Statutes considered

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