- 1 - HC-KAR NC: 2025:KHC:27867 WP No. 11621 of 2022 IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 23RD DAY OF JULY, 2025 BEFORE THE HON'BLE MR. JUSTICE S SUNIL DUTT YADAV WRIT PETITION NO. 11621 OF 2022 (GM-RES) BETWEEN: 1. SRI. MOKSHA GUNDAM A.G., AGED ABOUT 35 YEARS PROP-SRI CHANNANJESWARA ENTERPRISES (REGISTERED FIRM UNDER INDIAN PARTNERSHIP ACT, 1932), NO.140, LINGAWATHA STREET, NEAR BASAVA MANDIRA, ALLURU, CHAMARAJANAGARA DISTRICT-571 117. 2. SRI SATHISHKUMAR A M., AGED ABOUT 39 YEARS S/O LATE MALLANNA 3. SRI J V MURALIDHARA VERMA, AGED ABOUT 60 YEARS S/O LATE G V VENKATESHA VERMA, PETITIONERS NO.2 & 3 ARE R/A NO.788/51, 9TH CROSS RAMANUJA ROAD, AGRAHARA MYSURU - 570 004. …PETITIONERS (BY SRI. P NATARAJU, ADVOCATE) AND: 1. THE DEPUTY COMMISSIONER AND DISTRICT MAGISTRATE, MYSURU DISTRICT, MYSURU-570 005. 2. THE REGIONAL OFFICER, BANK OF BARODA, REGIONAL OFFICE, 1ST FLOOR, BARODA SOUDHA THONACHIKOPPALU, 2ND STAGE, SARASWATHIPURAM MYSURU - 570 023. Digitally signed by GEETHAKUMARI PARLATTAYA S Location: High Court of Karnataka - 2 - HC-KAR NC: 2025:KHC:27867 WP No. 11621 of 2022 3. THE MANAGER, BANK OF BARODA, NEAR SANGEETHA CORNER, SIDDARTHA LAYOUT BRANCH MYSURU - 570 011. …RESPONDENTS (BY SRI MOHAMMED JAFFAR SHAH, AGA FOR R1; SRI VIGNESH SHETTY, ADVOCATE FOR R2 & R3) THIS W.P. IS FILED UNDER ARTICLES 226 & 227 OF THE CONSTITUTION OF INDIA, PRAYING TO QUASH THE ORDER PASSED BY THE R-1 IN CASE NO.M.A.G.(3)MIS/109/2022 DATED 18.05.2022 VIDE ANNX-A. THIS PETITION, COMING ON FOR FRESH MATTERS, THIS DAY, ORDER WAS MADE THEREIN AS UNDER: CORAM: HON'BLE MR. JUSTICE S SUNIL DUTT YADAV ORAL ORDER The petitioners have called in question the correctness of the order passed at Annexure-A relating to the proceedings under Section 14 of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 ('SARFAESI Act' for brevity). Various contentions have been raised by the petitioners including that the petitioners were urging for settling the dispute if amicable resolution was made under one time settlement scheme. Petitioners further submit that if reasonable time is given, they would clear the arrears, though they seek renegotiation of the terms of the loan. - 3 - HC-KAR NC: 2025:KHC:27867 WP No. 11621 of 2022 2. It is noticed that this Court by interim order passed on 22.06.2022 had stayed the order at Annexure-A subject to adherence of certain conditions relating to deposit. The petitioners submit that the amount required to be deposited has been made. 3. Learned counsel for the respondent - Bank submits that as regards Annexure-A substantive remedy is under Section 17 of the SARFAESI Act and Court ought to relegate the petitioners to avail appropriate remedy under Section 17. 4. 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 v. 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 taxes, cess, fees, other - 4 - HC-KAR NC: 2025:KHC:27867 WP No. 11621 of 2022 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 Court, which every High Court is bound to keep in view while exercising power under Article 226 of the Constitution. 45. It is true that the rule of exhaustion of alternative remedy is a rule of discretion and not one of - 5 - HC-KAR NC: 2025:KHC:27867 WP No. 11621 of 2022 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." 5. In light of the observations made by the Apex Court, it can be noticed that several factual contentions raised by the petitioners are the matters that cannot be adjudicated in the present proceedings. 6. 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. - 6 - HC-KAR NC: 2025:KHC:27867 WP No. 11621 of 2022 7. 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. 8. The interim protection granted under this order is only to enable the petitioners to avail of 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 approach are to look at the matter afresh uninfluenced by the observations made herein. 9. 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 PSG List No.: 1 Sl No.: 27