- 1 - HC-KAR CNR: KAHC010192542022 NC: 2026:KHC:40442 WP No. 8691 of 2022 IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 3RD DAY OF AUGUST, 2026 BEFORE THE HON'BLE MR. JUSTICE M.G.S. KAMAL WRIT PETITION NO. 8691 OF 2022 (GM-RES) BETWEEN: NAVRATHAN JEWELLERS PRIVATE LIMITED, NO.87, 1ST FLOOR, M G ROAD, BANGALORE- 560001, REP BY ITS MANAGING DIRECTOR, SHRI M GOUTHAM CHAND. …PETITIONER (BY SRI. UMESHA A., ADVOCATE FOR SRI. VASANTHA A K., ADVOCATE) AND: HDFC BANK LIMITED, MANIPAL BRANCH UDUPI TALUK AND DISTRICT, REP BY ITS MANAGER. ALSO AT HEAD OFFICE AT HDFC BANK LIMITED, HDFC BANK HOUSE, SENAPATI BAPAT MARG, LOWER PAREL (WEST), MUMBAI- 400013. …RESPONDENT (BY SRI. FRANCIS XAVIER., ADVOCATE) THIS WP FILED UNDER ARTICLES 226 AND 227 OF THE CONSTITUTION OF INDIA PRAYING TO-QUASH THE IMPUGNED Digitally signed by SUMA B N Location: HIGH COURT OF KARNATAKA - 2 - HC-KAR CNR: KAHC010192542022 NC: 2026:KHC:40442 WP No. 8691 of 2022 LETTER DTD 11.04.2022 ISSUED BY THE RESPONDENT BANK VIDE ANNEXURE-M., AND ETC. THIS PETITION, COMING ON FOR PRELIMINARY HEARING IN B GROUP, THIS DAY, ORDER WAS MADE THEREIN AS UNDER: CORAM: HON'BLE MR. JUSTICE M.G.S. KAMAL ORAL ORDER Petitioner a private Limited Company had availed certain financial facilities for its business development from the respondent-bank. The cash credit facility of ₹95,00,00,000/- had been sanctioned by the respondent - bank vide sanction letter dated 20.10.2020 for the purpose of working capital requirement, initially at the rate of 8.30% per annum with additional interest levied at 2% per annum. It is contented that in terms of Clause No.12 of the sanction letter dated 20.10.2020, the respondent - bank had reserved its right to charge the borrower 1% of the total limits sanctioned as fore-closure charges. Clause 15 of the said sanction letter provided borrower being liable to pay 4% of the total limits sanctioned in the case - 3 - HC-KAR CNR: KAHC010192542022 NC: 2026:KHC:40442 WP No. 8691 of 2022 of facilities were taken over by another bank during the tenor of the loan. It is contented that the petitioner had executed MOE on 23.12.2021 in favour of the respondent - bank and deposit the title deeds. The renewal was due on 20.10.2021. However, the petitioner orally informed the respondent - bank, it was not planning to continue the cash credit facility as the facility was to be taken over by Axis Bank along with Yes Bank and ICICI Bank. Accordingly, the petitioner closed the entire dues which had been availed from the respondent - bank as on 09.02.2022. When the petitioner, thereafter made a request for discharge of the charge created in favour of the respondent - bank by executing discharge of deposit of title deed and to handover the entire original documents, the respondent - bank issued a reply dated 11.02.2022 claiming pre-closure charges of ₹4,82,86,456/- for closing the facility and to discharge the charge and release the document. Being aggrieved, the petitioner is before this Court. - 4 - HC-KAR CNR: KAHC010192542022 NC: 2026:KHC:40442 WP No. 8691 of 2022 2. The learned counsel for the petitioner submits that the demand being made by the respondent on the purported premise of pre-closure charges and refusing to discharge the mortgage and deliver the document is illegal, unsustainable therefore, writ petition is maintainable seeking quash of the communication dated 11.04.2022 and for a direction for the respondent to release the document. 3. The learned counsel for the respondent - bank relies upon the judgment of the Hon'ble Apex Court in the case of Federal Bank Ltd. v. Sagar Thomas and Others reported in (2003) 10 SCC 733 submits that petition of this nature, more particularly, raising the issue of breach of terms of the loan agreement, is not maintainable. He submits relief if any has to be availed by the petitioner before a competent Court or civil jurisdiction. 4. Heard and perused the records. - 5 - HC-KAR CNR: KAHC010192542022 NC: 2026:KHC:40442 WP No. 8691 of 2022 5. Facts narrated above indicate that the petitioner is seeking redressal of his grievance on the basis of purported terms of the loan agreement, which according to the petitioner, do not warrant him to pay the pre- closure charges. While according to the respondent - bank, petitioner is liable to pay the pre-closure charges in the event of loan being taken over by another bank during the continuation of tenor of the loan. 6. Writ petition concerning disputed question of facts arising out of performance or non performance of terms of contract cannot be entertained. Further, as held by the Apex Court in the case of Federal Bank Ltd. Vs. Sagar Thomas and others (supra), writ will not be issued against a company in Companies Act, merely, under the regulatory provisions. Private scheduled banks do not constitute public authorities under Article 12 unless they - 6 - HC-KAR CNR: KAHC010192542022 NC: 2026:KHC:40442 WP No. 8691 of 2022 perform duties, court has limited scope of Article 226 writ jurisdiction for such entities. 7. In that view of the matter, reserving liberty to the petitioner to avail remedy as may be available, if so advised, petition is dismissed. 8. At this juncture, the learned counsel for the respondent - bank submits that in terms of interim order dated 26.04.2022, passed by this Court, the original documents pertaining to the property has been handed over to the petitioner subject to the petitioner furnishing the bank guarantee in a sum of ₹2,43,00,000/-. He further submits that the petitioner be directed to continue the bank guarantee until disposal of the matter. The bank guarantee so furnished shall be continued till petitioner gets his grievance redressed in accordance with law as noted above. Such steps shall be taken by the petitioner within a period of 90 days from receipt of certified copy of - 7 - HC-KAR CNR: KAHC010192542022 NC: 2026:KHC:40442 WP No. 8691 of 2022 this order, failing which, the bank is entitled to initiate action as noted above. Sd/- (M.G.S. KAMAL) JUDGE Vmb List No.: 1 Sl No.: 26