- 1 - HC-KAR CNR: KAHC010100482003 NC: 2026:KHC:36476 CA No. 104 of 2003 In COP No.77 of 1987 IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 16TH DAY OF JULY, 2026 BEFORE THE HON'BLE MS. JUSTICE JYOTI M COMPANY APPLICATION NO. 104 OF 2003 IN COMPANY PETITION NO.77 OF 1987 BETWEEN: THE KARNATAKA INDUSTRIAL AREA DEVELOPMENT BOARD, NO.14/3, II FLOOR, NRUPATHUNGA ROAD, BENGALURU, REPRESENTED BY ITS CHIEF EXECUTIVE OFFICER AND EXECUTIVE MEMBER. …APPLICANT (BY SRI. B.B.PATIL, ADVOCATE) AND: M/S. CHAMUNDI MOPEDS LIMITED (IN LIQUIDATION) REPRESENTED BY THE OFFICIAL LIQUIDATOR HIGH COURT OF KARNATAKA, IV FLOOR, D AND F WING, KENDRIYA SADAN, KORAMANGALA, BENGALURU-560034. …RESPONDENT (BY MS. KRUTIKA RAGHAVAN, ADVOCATE FOR OL) THIS COMPANY APPLICATION IS FILED UNDER SECTION 446 (2)(b) OF THE COMPANIES ACT, 1956. Digitally signed by PREMCHANDRA M R Location: HIGH COURT OF KARNATAKA - 2 - HC-KAR CNR: KAHC010100482003 NC: 2026:KHC:36476 CA No. 104 of 2003 In COP No.77 of 1987 THIS COMPANY APPLICATION IS LISTED FOR ARGUMENTS, THIS DAY AN ORDER IS MADE AS UNDER: ORAL ORDER Sri.B.B.Patil., counsel for the applicant and Smt.Krutika Raghavan., counsel for the Official Liquidator and the Official Liquidator appeared in person. 2. This application is filed to permit the applicant - Board to resume the possession of industrial plot Nos. 1 and 2 of Hirehalli Industrial Area, Tumkur, measuring 43,346 Sq. mts., and grant such other relief/s this Court deems fit, including award of costs, in the interest of justice and equity. 3. Counsel for the respective parties urged several contentions. Counsel for the applicant submits that, owing to the non-performance and failure to comply with the allotment conditions, the Karnataka Industrial Areas Development Board (KIADB) seeks to resume the land under Section 34B of the KIADB Act. It is therefore prayed that permission be granted to the Board to take appropriate steps to resume possession of - 3 - HC-KAR CNR: KAHC010100482003 NC: 2026:KHC:36476 CA No. 104 of 2003 In COP No.77 of 1987 industrial plot Nos. 1 and 2 situated at Hirehalli Industrial Area, Tumkur, measuring 43,346 sq. mts. 4. Heard counsel and perused the record with care. 5. The industrial plots in question belong to KIADB and were allotted to the respondent company, M/s. Chamundi Mopeds Limited (in liquidation), for the expansion of its industrial activities. The allotment conditions, however, were not fulfilled. Upon expiry of the lease period, the allottee acquires the status of a sale agreement holder only if the land has been duly utilized and the project has been fully implemented. In the event of failure, the allottee continues merely as a tenant holding over, and the lessor’s right to terminate the lease and resume possession remains intact. The respondent company, being in liquidation, has failed to comply with the allotment terms. The issue is no longer res integra. The Hon’ble Supreme Court, in a catena of decisions, has affirmed that the allotting authority or corporation is entitled to resume the plot where the allottee fails to establish the industrial project. - 4 - HC-KAR CNR: KAHC010100482003 NC: 2026:KHC:36476 CA No. 104 of 2003 In COP No.77 of 1987 It is undisputed that the plots were allotted at a subsidized rate to promote industrial growth. The allottee, however, did not utilize the land as required. Permitting the Official Liquidator to sell the land to discharge the liabilities of the defaulting concern would defeat the valuable rights of the applicant Board, undermine the very purpose of allotment, and result in a miscarriage of justice. This Court therefore finds it appropriate to grant permission to the applicant Board. Accordingly, the applicant KIADB is permitted to take action to resume possession of industrial plot Nos. 1 and 2 of Hirehalli Industrial Area, Tumkur, measuring 43,346 sq. mts., strictly in accordance with Section 34B of the KIADB Act. 6. Resultantly, the Company Application stands allowed. Sd/- (JYOTI M) JUDGE MRP List No.: 2 Sl No.: 13