- 1 - HC-KAR NC: 2025:KHC:23933 WP No. 21722 of 2022 IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 2ND DAY OF JULY, 2025 BEFORE THE HON'BLE MR. JUSTICE S SUNIL DUTT YADAV WRIT PETITION NO. 21722 OF 2022 (GM-RES) BETWEEN: SRI V RAGHAVENDRA, S/O N VASUDEVACHAR, AGED ABOUT 56 YEARS, NO.50, ACHARYA ARCADE, 1ST BLOCK, 3RD PHASE, BANASHANKARI II STAGE, BENGALURU - 560 085. … PETITIONER (BY SRI. RAMESH P. KULKARNI., ADVOCATE) AND: 1. STATE OF KARNATAKA, ADDITIONAL CHIEF SECRETARY, DEPARTMENT OF HOME VIDHANA SOUDHA, DR AMBEDKAR VEEDHI, BENGALURU - 560 001. 2. BASAVANAGUDI POLICE STATION, REPRESENTED BY STATION HOUSE OFFICER, BASAVANAGUDI, BENGALURU 560 004. 3. SRI DWARAKANATH, THE PRESIDENT, Digitally signed by PRAKASH N Location: HIGH COURT OF KARNATAKA - 2 - HC-KAR NC: 2025:KHC:23933 WP No. 21722 of 2022 SREE CHARAN SOUHARDA CO-OP BANK LTD, NO .87/1, H B SAMAJA ROAD, BASAVANAGUDI, BENGALURU 560 004. 4. SRI JAYATHEERTHA R KATTI, THE BRANCH MANAGER, GANDHI BAZAR BRANCH, SREE CHARAN SOUHARDA CO-OP BANK LTD, NO. 87/1, H B SAMAJA ROAD, BASAVANAGUDI, BENGALURU 560 004. 5. THE BRANCH MANAGER, CITY MARKET BRANCH, SREE CHARAN SOUHARDA CO-OP BANK LTD, "SUBBAMMA KRUPA", P R SHASTRY LANE, NAGARTHPET CROSS, BENGALURU - 560 002. 6. AUTHORISED OFFICER, SREE CHARAN SOUHARDA CO-OP BANK LTD, NO.87/1, H B SAMAJA ROAD, BASAVANAGUDI, BENGALURU - 560 004. 7. CENTRAL BUREAU OF INVESTIGATION, ACB NO.36, BELLARY ROAD, GANGA NAGAR, BENGALURU - 560 032. - 3 - HC-KAR NC: 2025:KHC:23933 WP No. 21722 of 2022 8. COMMISSIONER OF POLICE, INFANTRY ROAD, BENGALURU - 560 001. … RESPONDENTS (BY SRI. MOHAMMED JAFFAR SHAH, AGA FOR R1, R2 & R8; SRI D.R. RAVI SHANKAR, SENIOR COUNSEL FOR SRI SHARATH KUMAR SHETTY, ADVOCATE FOR R5 & R6; SRI P. PRASANNA KUMAR, ADVOCATE FOR R7; SRI VIGNESH SHETTY, ADVOCATE FOR R3 & R4) THIS W.P. IS FILED UNDER ARTICLES 226 AND 227 OF THE CONSTITUTION OF INDIA, PRAYING TO DIRECT THE R2 POLICE OR THE R7 CENTRAL BUREAU OF INVESTIGATION TO INVESTIGATE INTO THE COMPLAINT DTD 10.08.2021 AT ANNEXURE-F GIVEN BY THE PETITIONER HEREIN AND ETC. THIS PETITION COMING ON FOR PRELIMINARY HEARING IN 'B' GROUP THIS DAY, ORDER WAS MADE THEREIN AS UNDER: CORAM: HON'BLE MR. JUSTICE S SUNIL DUTT YADAV ORAL ORDER Learned counsel for the petitioner has sought for the following reliefs:- "(i) issuance of Writ of Mandamus to direct Respondent No. 2- the state police, Basavangudi Police Station or Respondent No. 7- Central Bureau of Investigation to investigate the complaint dated 10.08.2021 at Annexure-F; (ii) issuance of writ of certiorari or order to set aside the endorsement at Annexure- G. The endorsement at Annexure- G is issued by the Basavangudi Police dated - 4 - HC-KAR NC: 2025:KHC:23933 WP No. 21722 of 2022 02.10.2021 to the effect that the dispute related to financial transaction which must be raised before the appropriate forum and no grounds are made out to entertain the complaint; (iii) sought for setting aside of the notice at Annexure-K and K1 which are notices issued under Section 13(2) of the SARFAESI Act; and (iv) sought for setting aside of the notices in respect of taking of actual possession of immovable property at Annexure – A." 2. Various other contentions have also been raised by the petitioner. 3. Sri Uday Holla, learned Senior Counsel appearing on behalf of petitioner submits that the respondent No.3 - Bank has made withdrawals from the Loan Account which was not demonstrated by the Bank. 4. It is further submitted that, insofar as the contention of the availability of substantive remedy under the SARFAESI Act as raised by the respondent - Bank, the Court could intervene, in light of the exceptions made out, - 5 - HC-KAR NC: 2025:KHC:23933 WP No. 21722 of 2022 wherein Court could entertain petitions under Article 226 of the Constitution of India as settled by various judgments of the Apex Court. Reliance is placed on the judgment of the Apex Court in the case of Commissioner of Income Tax and Ors. v. Chhabil Dass Agarwal reported in 2014 (1) SCC 603 and in the case of Authorized Officer, State Bank of Travancore v. Mathew K.C., reported in (2018) 3 SCC 85. Further reliance is also placed on the order of Co-ordinate Bench in the case of Santhosh Kumar B.S. v. UCO Bank reported in AIR 2024 Kar 74. 5. Sri D.R. Ravishankar, learned Senior Counsel appearing on behalf of respondent Bank submits that the contention including not following of the procedure as regards Section 13(3-A) of SARFAESI Act, is a matter that requires to be raised as substantive remedy under Section 17 aggrieved by a measure under Section 13. - 6 - HC-KAR NC: 2025:KHC:23933 WP No. 21722 of 2022 6. It is also noted that the petitioners were granted multiple opportunities to amend the petition, which were duly allowed. 7. Heard both sides. 8. It must be noticed that various contentions raised require a recording on finding of fact, including allegations of fraudulent withdrawals, forgery of documents, and siphoning of funds of Rs.9,79,93,210 by the respondent Bank. The petitioner has relied upon materials to support his claims before the Court, however, a conclusive determination of the same is to be made only in statutorily constituted proceedings. 9. No doubt, certain interlocutory directions have been passed by this Court, however, the question still remains as regards the availability of substantive remedy. 10. The contentions raised are also densely factual in nature and all aspects could be well raised before the - 7 - HC-KAR NC: 2025:KHC:23933 WP No. 21722 of 2022 Debts Recovery Tribunal in terms of the proceedings under Section 17 of Act. 11. It must be noticed that the repeated assertions of the Apex Court right from United Bank of India v. Satyawati Tondon and Others reported in (2010) 8 SCC 110 (Satyawati Tondon), lean towards non- entertaining of writ petitions where substantive remedy is available under the SARFAESI Act. The relevant observations of the Apex Court are as follows: "43. Unfortunately, the High Court overlooked the settled law that the High Court will ordinarily not entertain a petition under Article 226 of the Constitution if an effective remedy is available to the aggrieved person and that this rule applies with greater rigour in matters involving recovery of taxes, cess, fees, other types of public money and the dues of banks and other financial institutions. In our view, while dealing with the petitions involving challenge to the action taken for recovery of the public dues, etc. the High Court must keep in mind that the legislations enacted by Parliament and State Legislatures for recovery of such dues are a code unto themselves inasmuch as they not only contain comprehensive - 8 - HC-KAR NC: 2025:KHC:23933 WP No. 21722 of 2022 procedure for recovery of the dues but also envisage constitution of quasi-judicial bodies for redressal of the grievance of any aggrieved person. Therefore, in all such cases, the High Court must insist that before availing remedy under Article 226 of the Constitution, a person must exhaust the remedies available under the relevant statute. 44. While expressing the aforesaid view, we are conscious that the powers conferred upon the High Court under Article 226 of the Constitution to issue to any person or authority, including in appropriate cases, any Government, directions, orders or writs including the five prerogative writs for the enforcement of any of the rights conferred by Part III or for any other purpose are very wide and there is no express limitation on exercise of that power but, at the same time, we cannot be oblivious of the rules of self-imposed restraint evolved by this Court, which every High Court is bound to keep in view while exercising power under Article 226 of the Constitution. 45. 45. It is true that the rule of exhaustion of alternative remedy is a rule of discretion and not one of compulsion, but it is difficult to fathom any reason why the High Court should entertain a petition filed under Article 226 of the Constitution and pass interim order ignoring the fact that the - 9 - HC-KAR NC: 2025:KHC:23933 WP No. 21722 of 2022 petitioner can avail effective alternative remedy by filing application, appeal, revision, etc. and the particular legislation contains a detailed mechanism for redressal of his grievance. 55. It is a matter of serious concern that despite repeated pronouncement of this Court, the High Courts continue to ignore the availability of statutory remedies under the DRT Act and the Sarfaesi Act and exercise jurisdiction under Article 226 for passing orders which have serious adverse impact on the right of banks and other financial institutions to recover their dues. We hope and trust that in future the High Courts will exercise their discretion in such matters with greater caution, care and circumspection." 12. The judgment of Apex Court in Satyawati Tondon (supra) has been reiterated by the Apex Court in subsequent judgments as well, viz., Bank of India v. Sri Nangli Rice Mills - 2025 SCC OnLine 12291; Celir LLP v. Bafna Motors (Mumbai) Pvt. Ltd. & Ors.,2 (2024) 2 1 Relevant observations are made at para.-112 of the judgment. 2 Relevant observations are made at para-97 of the judgment. - 10 - HC-KAR NC: 2025:KHC:23933 WP No. 21722 of 2022 SCC 1; Phoenix ARC v. Vishwa Bharati Vidya Mandir (2022) 5 SCC 345.3 13. In light of the observations made by the Apex Court, it can be noticed that the appropriate remedy would be to relegate the petitioner to seek for substantive remedy before the Debt Recovery Tribunal and in light of several factual contentions relating to fraudulent withdrawals and others raised by the petitioner are matters that cannot be adjudicated in the present proceedings. 14. The contention of the petitioner seeking a CBI probe into the alleged fraudulent withdrawals by the respondent Bank remains at this stage a mere allegation that requires proof through appropriate inquiry. The writ Court is not the proper forum to adjudicate the matters that are factually dense. Any request for such an investigation may be considered, if a substantive basis is first established through proceedings before the Debts 3 Relevant observations are made at para-10 of the judgment. - 11 - HC-KAR NC: 2025:KHC:23933 WP No. 21722 of 2022 Recovery Tribunal and sufficient material is placed on record pursuant to such proceedings to warrant further inquiry by the appropriate forum. 15. Accordingly, the petition is disposed off relegating the petitioner to avail of the substantive remedy as regards the impugned proceedings. All contentions of both the sides are kept open. 16. Needless to state that while considering the aspect of limitation, in the event, the proceedings are instituted before the Debts Recovery Tribunal, the time spent before this Court may be taken note of appropriately. Sd/- (S SUNIL DUTT YADAV) JUDGE SHS/List No.: 1 Sl No.: 42