- 1 - HC-KAR NC: 2025:KHC:26469 WP No. 16884 of 2025 IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 16TH DAY OF JULY, 2025 BEFORE THE HON'BLE MR. JUSTICE S SUNIL DUTT YADAV WRIT PETITION NO. 16884 OF 2025 (GM-RES) BETWEEN: 1. MR RAMACHANDRA S/O GUJJAPPA AGED ABOUT 57 YEARS 2. MR. PRAKASH. R S/O RAMACHANDRA AGED ABOUT 47 YEARS 3. MR. HARISH. R S/O RAMACHANDRA AGED ABOUT 46 YEARS THE PETITIONERS NO. 1-3 ARE RESIDING AT NO.42, 1ST FLOOR, SRI. LAKSHMI VENKATESHWARA NILIYA, 9TH MAIN ROAD, NEAR ICICI BANK ATM HONGSANDRA NORTH, BENGALURU-560068. …PETITIONERS (BY SRI. PURUSHOTHAMA H., ADVOCATE) AND: 1. M/S TUMKUR GRAIN MERCHANTS CO-OPERATIVE BANK LTD. ADMIN OFFICE BH ROAD, TUMKUR-572103 IFSC CODE TGMB0000001 REP. BY ITS AUTHORISED SIGNATORY MR. RAJASHEKAR. Digitally signed by PRAKASH N Location: HIGH COURT OF KARNATAKA - 2 - HC-KAR NC: 2025:KHC:26469 WP No. 16884 of 2025 2. MR. VENUGOPAL S.H S/O S.V. HANUMANTHAREDDY AGED ABOUT 50 YEARS R/AT 1083, 14TH MAIN, 18TH CROSS NEAR BDA COMPLEX, HSR LAYOUT, 3RD SECTOR, BENGALURU-560102. …RESPONDENTS (BY SRI. K V LOKESH., ADVOCATE) THIS WP IS FILED UNDER ARTICLES 226 AND 227 OF THE CONSTITUTION OF INDIA PRAYING TO ALLOW THE ABOVE PETITION. SET ASIDE THE ISSUED SALE CERTIFICATE DATED 05/03/2025 ISSUED BY THE RESPONDENT 1 EXECUTED INFAVOUR OF THE RESPONDENT NO.2 HEREIN IN RESPECT OF SCHEDULE PROPERTY VIDE ANNEXURE-A BY ISSUE OF WRIT OF CERTIORARI. THIS PETITION, COMING ON FOR ORDERS, THIS DAY, ORDER WAS MADE THEREIN AS UNDER: CORAM: HON'BLE MR. JUSTICE S SUNIL DUTT YADAV ORAL ORDER Petitioners have called in question the validity of the action of respondent No.1 - Bank in issuing sale certificate in favour of respondent No. 2. 2. Petitioners have raised various contentions including that the procedure under Section 13 has not been followed and that the price at which the property has been sold was undervalued and that there are procedural - 3 - HC-KAR NC: 2025:KHC:26469 WP No. 16884 of 2025 lapses. It is submitted that due to bonafide reason the loan could not be repaid. 3. Sri. K. V. Lokesh, learned counsel appearing for respondent No. 1 - Bank submits that sale certificate has already been issued and there is no further action to be taken from the side of the respondent as the sale certificate has been handed over to respondent No. 2. 4. Respondent No. 2 has not yet been served. However taking note of the submission of learned counsel for the respondent - Bank that as against any action or measure under Section 13 of the SARFAESI Act, petitioners are to avail of the substantive remedy under Section 17 of the SARFAESI Act, it would be appropriate to relegate the petitioners to avail of the substantive remedy under Section 17 of the SARFAESI Act. 5. 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 - 4 - HC-KAR NC: 2025:KHC:26469 WP No. 16884 of 2025 Others - (2010) 8 SCC 110 that the appropriate remedy would be to relegate the petitioner 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 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. - 5 - HC-KAR NC: 2025:KHC:26469 WP No. 16884 of 2025 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 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. - 6 - HC-KAR NC: 2025:KHC:26469 WP No. 16884 of 2025 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." 6. 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. 7. 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. 8. In light of disposal of writ petition, it would meet the ends of justice by directing the respondent - - 7 - HC-KAR NC: 2025:KHC:26469 WP No. 16884 of 2025 Bank not to take any precipitative steps for a period of four weeks from today. 9. The interim protection granted under this order is only to enable the petitioners to avail of the 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. 10. 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. 11. It is reiterated that the direction is passed only as regards respondent No.1 - Bank and as respondent No. 2 has not been served with notice, as it is the case of the petitioner that respondent No. 2 derives right through the - 8 - HC-KAR NC: 2025:KHC:26469 WP No. 16884 of 2025 respondent No.1 - Bank, notice is waived as regards respondent No. 2. Needless to state, in the event of any proceedings before the Debts Recovery Tribunal, respondent No. 2 would have to be made a party. 12. Accordingly, petition is disposed off. Sd/- (S SUNIL DUTT YADAV) JUDGE VP