- 1 - HC-KAR NC: 2025:KHC:26606 WP No. 20456 of 2023 IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 17TH DAY OF JULY, 2025 BEFORE THE HON'BLE MR. JUSTICE S SUNIL DUTT YADAV WRIT PETITION NO. 20456 OF 2023 (GM-RES) BETWEEN: 1. VARADARAJU C AGED ABOUT 48 YEARS, S/O CHIKKATAMMAIAH, R/AT HELAVARAHUNDI, KASABA HOBLI, T NARASIPURA TALUK, MYSURU DISTRICT-571124 2. AMBIKA AGED ABOUT 38 YEARS, W/O VARADARAJU C, R/AT HELAVARAHUNDI, KASABA HOBLI, T NARASIPURA TALUK, MYSURU DISTRICT-571124 …PETITIONERS (BY SRI. SHIVA KUMARA K.S, ADVOCATE) AND: M/S MANAPPURAM HOME FINANCE LIMITED HAVING ITS BRANCH OFFICE AT. NEW KANTHARAJA URS ROAD, MYSURU-571124, REP BY ITS AUTHORIZED OFFICER, MR BASAVARAJU. …RESPONDENT (BY SRI. B.S. MAHENDRA, ADVOCATE) THIS WP IS FILED UNDER ARTICLES 226 AND 27 OF THE CONSTITUTION OF INDIA PRAYING TO-DECLARE THAT THE ORDER PRODUCED AT ANNEXURE-A PASSED BY I ADDL. SR. Digitally signed by PRAKASH N Location: HIGH COURT OF KARNATAKA - 2 - HC-KAR NC: 2025:KHC:26606 WP No. 20456 of 2023 CIVIL JUDGE AND CJM MYSURU IN CRL. MISC.NO.245/2022 PASSED AN ORDER DTD 05.07.2023 FOR TAKING A PHYSICAL POSITION IS ILLEGAL AND QUASH THE SAME ALLOW THIS WRIT PETITION WITH COSTS AND ETC., THIS PETITION, COMING ON FOR PRELIMINARY HEARING, THIS DAY, ORDER WAS MADE THEREIN AS UNDER: CORAM: HON'BLE MR. JUSTICE S SUNIL DUTT YADAV ORAL ORDER 1. No representation on behalf of the petitioners when the matter is called out. Learned counsel for the respondent submits that the matter is to be taken up on its merits and decided in light of availability of substantive remedy under Section 17 of the SARFAESI Act as against the order passed at Annexure - A. 2. It is further submitted that in light of non-adherence of the conditions imposed while granting of the interim order, matter requires to be disposed off and no further indulgence to be given to the petitioners. 3. The petitioners have called in question the validity of the order at Annexure-A passed in Crl.Misc.No.245/2022 dated 05.07.2023. By virtue of the order of the Magistrate, - 3 - HC-KAR NC: 2025:KHC:26606 WP No. 20456 of 2023 the permission has been granted to the respondent - Bank to take possession of the scheduled property for realization of the outstanding loan. Before entering into the other relevant facts, it must be noticed that this Court has granted an interim order on 15.09.2023. On 02.011.2023, though it was reported that 25% of Rs.8,32,980/- has been deposited, it is to be noticed that the petitioners were further directed to deposit 25% of Rs.8,32,980/- in addition to the deposit already made. The court had also noticed the undertaking of the petitioners to settle the matter amicably. 4. This Court on 16.07.2024 had clearly noticed the availability of substantive remedy under Section 17 of the SARFAESI Act. 5. Learned counsel for the respondent submits that apart from the first payment of 25% of Rs.8,32,980/-, no further deposit has been made despite the undertakings made. The petitioners have raised various contentions while assailing the order passed under Section 14 of the - 4 - HC-KAR NC: 2025:KHC:26606 WP No. 20456 of 2023 learned Magistrate including as regards charging of exorbitant interest, not maintaining accounts properly and procedural lapses including classification of categorization of the petitioners' loan is non performing asset. Contentions require adjudication in proceedings under Section 17 as the same are factually dense. 6. In light of the contentions raised it is relevant to take note of the observations of the Apex Court in the case of United Bank of India vs. Satyawati Tondon and Others - (2010) 8 SCC 110 that the appropriate remedy would be to relegate the petitioners to seek for substantive remedy before the Debt Recovery Tribunal. 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 - 5 - HC-KAR NC: 2025:KHC:26606 WP No. 20456 of 2023 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 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 - 6 - HC-KAR NC: 2025:KHC:26606 WP No. 20456 of 2023 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 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." - 7 - HC-KAR NC: 2025:KHC:26606 WP No. 20456 of 2023 7. In light of the observations made by the Apex Court, it can be noticed that several factual contention raised by the petitioner are the matters that cannot be adjudicated in the present proceedings. 8. Accordingly, the petition is disposed off relegating the petitioners to avail of the substantive remedy as regards the impugned proceedings. All contentions of both the sides are kept open. 9. In light of disposal of writ petition, it would meet the ends of justice by directing the respondent - Bank not to take any precipitative steps for a period of three weeks from today. 10. The interim protection granted under this order is only to enable the petitioners to avail of his substantive remedy and must not be considered to be an order passed on the basis of adjudication on merits. Upon the lapse of the time stipulated, the protection granted would cease to operate and the authorities before whom petitioners may - 8 - HC-KAR NC: 2025:KHC:26606 WP No. 20456 of 2023 approach are to look at the matter afresh uninfluenced by the observations made herein. 11. Needless to state that while considering the aspect of limitation, in the event the proceedings are instituted before the DRT, time spent before this Court may be taken note of appropriately. Sd/- (S SUNIL DUTT YADAV) JUDGE DHA List No.: 1 Sl No.: 31