- 1 - HC-KAR NC: 2025:KHC:46061 WP No. 25932 of 2025 IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 7TH DAY OF NOVEMBER, 2025 BEFORE THE HON'BLE SMT. JUSTICE LALITHA KANNEGANTI WRIT PETITION NO. 25932 OF 2025 (GM-DRT) BETWEEN: 1. R.VIJAYALAKSHMI W/O K N RAJA @ KUMAR NARAYANAPPA RAJA AGED ABOUT 53 YEARS R/AT NO.153/2, 14TH CROSS, DOMLUR II STAGE, BENGALURU-560 071. 2. K N RAJA @ KUMAR NARAYANAPPA RAJA S/O K NARAYANAPPA AGED ABOUT 55 YEARS R/AT NO.153/2, 14TH CROSS, DOMLUR II STAGE, BENGALURU-560 071. …PETITIONERS (BY SRI. B RAJASHREE, ADVOCATE) AND: 1. NKGSB BANK NKGSB CO OP BANK LIMITED JAYANAGAR BRANCH AT GROUND FLOOR NEW NO.15 (458 AND 459 OLD NO.) 4TH T BLOCK, 18TH MAIN, JAYANAGAR, BENGALURU - 560 041 080-26530102/8655699420 JAYANAGAR96@NKGSB-BANK.COM Digitally signed by MEGHA MOHAN Location: HIGH COURT OF KARNATAKA - 2 - HC-KAR NC: 2025:KHC:46061 WP No. 25932 of 2025 REP. BY AUTHORIZED OFFICER/ BRANCH MANAGER ALSO AT: RECOVERY DEPARTMENT LAXMI SADAN 361 V P ROAD, GIRGAUM, MUMBAI - 400004 022 67545020/25/40/48/73/98 RECOVERY@NKGSB-BANK.COM 2. A PALANI S/O LATE ARUMUGAM AGED ABOUT 62 YEARS R/AT NO.1, ARUMUGAM LAYOUT N.K. STREET, VILLUPURAM TAMIL NADU- 605602. PRESENTLY AT: NO.77, SWAMI VIVEKANANDA ROAD HALASURU BANGALORE-560008. …RESPONDENTS (BY SRI. SHARATHKUMAR SHETTY, ADVOCATE FOR R1 SRI P.B. RAJU, ADVOCATE FOR R2) THIS PETITION IS FILED UNDER ARTICLE 226 OF THE CONSTITUTION OF INDIA PRAYING TO A). ISSUE WRIT OF CERTIORARI OR ANY OTHER WRIT SETTING ASIDE THE SALE OF SCHEDULE PROPERTY MADE PURSUANT TO E-AUCTION NOTICE DATED 09.07.2025 VIDE NO.NKGSB/JN/KNR/ASNA/96 MORT 17/34/2025-26 ISSUED BY RESPONDENTS AS PER ANNEXURE-R; B). ALTERNATIVELY DIRECT THE RESPONDENT TO ALLOW THE PETITIONER TO REDEEM THE MORTGAGE OF SECURED ASSETS BY RECEIVING DUE AMOUNT BY WAY OF OTS AND ETC. THIS PETITION, COMING ON FOR ORDERS, THIS DAY, ORDER WAS MADE THEREIN AS UNDER: CORAM: HON'BLE SMT. JUSTICE LALITHA KANNEGANTI - 3 - HC-KAR NC: 2025:KHC:46061 WP No. 25932 of 2025 ORAL ORDER The present writ petition is filed seeking the following prayer: “WHEREFORE, the Petitioners herein prays that this Hon'ble Court may be pleased to a. Issue Writ of Certiorari or any other Writ Setting aside the sale of schedule property made pursuant to e-auction notice dated 9.7.2025 video JNI NKGSB/KNR/ASNA/96 MORT 17/34/2025-26 issued by Respondents as per ANNEXURE R in so far as petitioners Concerned. b. Alternatively direct the Respondent to allow the petitioner to redeem the mortgage of secured assets by receiving due amount by way of OTS. c. Upon payment, direct the Respondents to issue No due certificate and execute the Discharge deed in respect of Schedule property in favour of the Petitioner. d. Alternatively this honorable court may be pleased to issue any appropriate rate or direction as this convoluted under the facts and circumstances of the case in the interest of justice and equity.” 2. The facts of the case are that petitioner No.1 is the absolute owner in respect of the scheduled property at item Nos.1 and 2 acquired under a partition deed amongst the family members and they have mortgaged the property to the bank and secured loan of an amount of Rs.32,00,000/-. The petitioners have further obtained the mortgage loan facility of Rs.22,00,000/- along with their daughter and son and the - 4 - HC-KAR NC: 2025:KHC:46061 WP No. 25932 of 2025 sanction letter is dated 17.06.2019. In furtherance to the earlier mortgage, petitioner No.1 further executed supplementary letter of evidence of deposit of title deeds of property dated 20.06.2019. Further, they have taken Rs.54,00,000/- and a demand notice under Section 13(2) of the SARFAESI Act was issued on 03.06.2021 and 15.07.2021. Later, the possession notice was issued on 12.10.2022 and the same was challenged before the Debt Recovery Tribunal in SA.No.739/2022 and SA.No.738/2022 along with I.A.No.2925/2022 and 2926/2022 were filed seeking for stay of the possession notice dated 12.10.2022, a conditional stay was granted on 04.11.2022. In SA.No.739/2022, the petitioners were directed to deposit an amount of Rs.8,30,000/- being 25% in two installments within one month. First installment of an amount of Rs.4,15,000/- to be paid on or before 19.11.2022 and second installment of an amount of Rs.4,15,000/- to be paid on or before 04.12.2022 and in SA.No.738/2022, the petitioners were directed to deposit an amount of Rs.6,70,000/- being 25% in two installments within one month. First installment of an amount of Rs.3,35,000/- to be paid on or before 19.11.2022 and second installment of Rs.3,35,000/- to - 5 - HC-KAR NC: 2025:KHC:46061 WP No. 25932 of 2025 be paid on or before 04.12.2022. Later, as the petitioners could not pay the amount in a time bound manner, the stay was vacated. Then, a notice was issued to vacate the premises on 21.12.2023 in view of the order passed under Section 14 of the SARFAESI Act in Crl.Misc.Nos.50139 and 50140/2023, the petitioners were called upon to pay an amount of Rs.39,79,031.75/- and Rs.31,55,636.69/- as on 29.11.2023. Then, the petitioners have approached this Court by filing W.P.No.966/2024. A conditional stay was granted on 10.01.2024 subject to deposit of an amount of Rs.15,00,000/- within 9 weeks. Interim order was extended on 01.02.2024, 20.02.2024, 28.02.2024, 28.03.2024, 16.04.2024. In respect of the other accounts, W.P.No.964/2024 GM(RES) was filed and on the same day stay was also granted. The bank had taken the physical possession on 08.05.2025. Both the writ petitions were dismissed as withdrawn. Then the respondent/bank have issued the e-auction notice on 09.07.2025, the auction was scheduled to be held on 19.08.2025. The petitioners have found a purchaser for the schedule property and approached the bank on 18.08.2025 offering for an OTS settlement of Rs.47,00,000/- and the payment will be cleared within 15 days. - 6 - HC-KAR NC: 2025:KHC:46061 WP No. 25932 of 2025 The respondent/bank orally informed that it would consider the same subject to confirmation of the head office. However, on 19.08.2025 afternoon the petitioners were orally informed that the auction was proceeded with and the sale was confirmed in favour of the prospective bidder. Though the petitioners have sought for the details, the same was not furnished, which made them to come before this Court. 3. Learned counsel appearing for the petitioners submits that when the petitioners were ready to pay the amount and they were ready for the one time settlement, the respondent/bank without giving an opportunity to the petitioners have put the property to auction. According to the petitioners, the outstanding amount is Rs.33,67,000/- and auction price is Rs.54,99,000/-. It is submitted that there is no transparency and the manner in which the bank had conducted the sale, the sale needs to be set aside. It is further submitted that by order dated 03.09.2025, the Co-ordinate Bench of this Court had directed not to induct anybody into the subject property until the next date of hearing. It is further submitted that the writ petition may be allowed. - 7 - HC-KAR NC: 2025:KHC:46061 WP No. 25932 of 2025 4. Learned counsel appearing for the respondent/bank submits that as per the sale notice the outstanding amount is Rs.55,76,000/- and the auction price is Rs.54,99,000/- and the auction was conducted for an amount of Rs.56,00,000/-. It is submitted that the sale certificate was issued on 03.09.2025. The auction purchaser has filed an I.A. to implead himself in this writ petition. It is submitted that there is no illegality in conducting the auction. The respondent/bank had conducted the auction as per the SARFAESI Act and as per the guidelines issued by the Reserve Bank of India. It is submitted that the writ petition is not maintainable and the petitioners are not entitled for any relief from this Court. 5. Learned counsel appearing for the auction purchaser, who is impleaded by this Court submits that he had paid the entire amount and sale certificate is issued in his favour. Inspite of that he is not in a position to enjoy the property in view of the order passed by the Co-ordinate Bench of this Court. The petitioners are not entitled for any relief from this Court. - 8 - HC-KAR NC: 2025:KHC:46061 WP No. 25932 of 2025 6. Having heard the learned counsels on either side, perused the material on record. In this case, the sale notice was questioned and the respondent/bank had conducted the auction and received the entire amount from the auction purchaser and the sale certificate is issued. The petitioners are raising several grounds pointing out that there is some irregularity in conducting the auction and the auction has to be set aside and the respondent/bank shall be directed to accept the proposal. This Court cannot grant any of the reliefs as sought for by the petitioners. Once the auction notice is issued, the petitioners have no right for redemption of mortgage. If the petitioners are of the view that there is an illegality in conducting the sale, petitioners have an effective, alternative remedy before the Debt Recovery Tribunal. Hence, this Court is not inclined to entertain this writ petition. In that view of the matter, this Court is passing the following: ORDER i. Accordingly, the writ petition is disposed of by giving liberty to the petitioners to avail the - 9 - HC-KAR NC: 2025:KHC:46061 WP No. 25932 of 2025 appropriate remedy in accordance with law particularly the law of limitation. ii. From 07.11.2025 till 08.12.2025 the order that is passed by the Co-ordinate Bench of this Court that the respondent/bank shall not induct anybody into the subject property, shall continue. iii. All I.As., in the writ petition shall stand closed. SD/- (LALITHA KANNEGANTI) JUDGE BN CT:bms List No.: 5 Sl No.: 9