- 1 - HC-KAR NC: 2026:KHC:6636 WP No. 6492 of 2019 IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 3RD DAY OF FEBRUARY, 2026 BEFORE THE HON'BLE MR. JUSTICE SURAJ GOVINDARAJ WRIT PETITION NO. 6492 OF 2019 (LB-RES) BETWEEN: SRI LOKESHA B C S/O SRI. CHINNAPPA, AGED ABOUT 33 YEARS R/AT WARD NO.4 VENKATAKOTE, CHINTAMANI-563 125. …PETITIONER (BY SRI. NARAYANA SWAMY V.K., ADVOCATE) AND: 1. THE STATE OF KARNATAKA REPRESENTED BY ITS SECRETARY TO GOVERNMENT, MUNICIPLE ADMN. DEPARTMENT, VIDHANA SOUDHA, BENGALURU CITY-560 001. 2. MUNICIPAL CORPORATION CHINTAMANI TOWN, CHINTAMANI, BY ITS COMMISSIONER-563125. …RESPONDENTS (BY SMT. CHANDINI SINGH, HCGP FOR R1; SRI. RAMESH KUMAR R.V., ADVOCATE FOR R2) THIS WRIT PETITION IS FILED UNDER ARTICLES 226 AND 227 OF THE CONSTITUTION OF INDIA PRAYING TO QUASH THE IMPUGNED ENDORSEMENT DTD 20.12.2018 VIDE ANNX-F ISSUED Digitally signed by SHWETHA RAGHAVENDRA Location: High Court of Karnataka - 2 - HC-KAR NC: 2026:KHC:6636 WP No. 6492 of 2019 BY THE R-2, AS ILLEGAL AND WITHOUT ANY AUTHORITY OF LAW 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 SURAJ GOVINDARAJ ORAL ORDER 1. The Petitioner is before this Court seeking for the following reliefs: a) “ISSUE a writ of certiorari or any other appropriate writ or order, quashing the impugned endorsement dated: 20.12.2018 bearing No. NCB/ D-NL/CR/01/018-19, at ANNEXURE-F issued by the 2nd Respondent, as illegal and without any authority of law; b) ISSUE a writ of mandamus directing the 2nd Respondent to consider the application of the petitioner for the Purchase of car as per Invoice of the dealer, dated: 12.12.2018 vide Annexure-E ie., to the extent of Rs.7,20,554/- (rupees Seven lakhs Twenty Thousand Five Hundred and Fifty Four only) subject to conditions imposed for repayment, in accordance with the Guidelines of self Employment Programme-Annexujre-C within a rider of one week from the date of order. c) ISSUE such other writ or order or direction as this Hon'ble Court may deem fit and proper in the facts and circumstances of the case, including imposing costs, in the interest of justice.” 2. The Petitioner claims to be a driving licence holder and wants to eke out his living as self-employment - 3 - HC-KAR NC: 2026:KHC:6636 WP No. 6492 of 2019 by purchasing a car and had applied to the State Government under the ‘Self Employment Programme’ for sanction of a loan to the extent of the invoice value of the car namely Rs.7,20,554/-. After consideration of the said application, the respondents informed that a loan amount of Rs.2,00,000/- was sanctioned, subject to the condition of the petitioner depositing 5% of the sanctioned amount. It is aggrieved by the same, the petitioner is before this Court seeking the aforesaid reliefs. 3. Sri V.K.Narayan Swamy, learned counsel for the Petitioner would submit that in terms of the scheme, there is a sanction of Rs.10,00,000/- which has been provided. The Petitioner having only sought for a loan for a sum of Rs.7,20,554/-, the entire amount ought to have been sanctioned to the petitioner, the respondents could not have restricted to a sum of Rs.2,00,000/-. It is on that basis that he submits that endorsement which has been issued is required - 4 - HC-KAR NC: 2026:KHC:6636 WP No. 6492 of 2019 to be quashed and mandamus to be issued to the respondents to consider the application of the petitioner and the entire amount to be sanctioned. 4. Sri R.V.Ramesh Kumar, learned counsel appearing for respondent No.2 would submit that in terms of self-employment scheme which has been initiated by the respondents-State, if a individual were to seek for loan, an amount of Rs.2,00,000/- would be provided as regards which no collateral would be sought for by the respondents inasmuch as the Reserve Bank of India (RBI) has exempted the need for providing collateral security up to an extent of Rs.10,00,000/- loan amount. 5. His submission is that the scheme restricting the payments to a sum of Rs.2,00,000/- and the respondents have always been ready and willing to make payment of the said amount. The petitioner has no vested right to seek for Rs.10,00,000/- since the same is not provided under the scheme. - 5 - HC-KAR NC: 2026:KHC:6636 WP No. 6492 of 2019 6. Heard Sri V.K.Narayana Swamy, learned counsel for the petitioner, Smt. Chandini Singh, learned HCGP for Respondent No.1 and Sri R.V.Ramesh Kumar, learned counsel for respondent No.2. Perused papers. 7. The short question that would arise for consideration in the present matter is: “Whether under the self-employment programme/scheme the petitioner would be entitled for a sum of Rs.10,00,000/- as a loan? 8. The guidelines in relation to a loan in respect of an individual are reproduced hereunder for easy reference: “¸ÀéAiÀÄA GzÉÆåÃUÀ PÁAiÀÄðPÀæªÀÄ C£ÀĵÁ×£ÀzÀ ªÀiÁUÀð¸ÀÆaUÀ¼ÀÄ" (Implementation Guidelines of Self Employment Programme) F WÀlPÁA±ÀzÀ£ÀéAiÀÄ £ÀUÀgÀ ¥ÀæzÉñÀzÀ §qÀ ªÀåQÛUÀ½UÉ ªÀÄvÀÄÛ UÀÄA¥ÀÄUÀ½UÉ CªÀgÀ°ègÀĪÀ PÀıÀ®vÉ, vÀgÀ¨ÉÃw, D¸ÀQÛ ªÀÄvÀÄÛ ¸ÀܽÃAiÀÄ ¥Àj¹ÜwUÉ C£ÀÄUÀÄtªÁV ¯Á¨sÀzÁAiÀÄPÀ ¸ÀéAiÀÄA GzÉÆåÃUÀ G¢ÝªÉÄUÀ¼ÀÄ ªÀÄvÀÄÛ QgÀÄ G¢ÝªÉÄUÀ¼À£ÀÄß ¸Áܦ¸ÀĪÀÅzÀPÉÌ ªÀåQÛUÀvÀ ªÀÄvÀÄÛ UÀÄA¥ÀÄ G¢ÝªÉÄUÀ¼À£ÀÄß ¸Áܦ¸ÀĪÀÅzÀPÉÌ DyðPÀ £ÉgÀªÀÅ ¤ÃqÀ¯ÁUÀĪÀÅzÀÄ. ¸ÀzÀj WÀlPÀzÀr ¸ÀéAiÀÄA GzÉÆåÃUÀªÀ£ÀÄß PÉÊUÉƼÀ°PÉÌ AiÀiÁªÀÅzÉà PÀ¤µÀ× CxÀªÁ UÀjµÀ× «zÁåºÀðvÉAiÀÄ£ÀÄß ¤UÀ¢¥Àr¹gÀĪÀÅ¢®è. i. ªÀåQÛUÀvÀ GzÀåªÀIJîvÉ (¸Á® ªÀÄvÀÄÛ ¸ÀºÁAiÀÄzsÀ£À) - 6 - HC-KAR NC: 2026:KHC:6636 WP No. 6492 of 2019  ªÉÊAiÀÄQÛPÀªÁV ¸ÀéAiÀÄA GzÉÆåÃUÀªÀ£ÀÄß, QgÀÄ G¢ÝªÉÄUÀ¼À£ÀÄß PÉÊUÉƼÀî®Ä ¸Á® ªÀÄvÀÄÛ ¸ÀºÁAiÀÄzsÀ£À ¸Ë®¨sÀåªÀ£ÀÄß MzÀV¸À¯ÁUÀĪÀÅzÀÄ.  ¥sÀ¯Á£ÀĨsÀ«AiÀÄ ¸Á® ¸Ë®¨sÀåPÉÌ Cfð ¸À°è¸ÀĪÁUÀ 18 ªÀµÀð ªÀAiÀĸÀÄì ¥ÀÆgÉʹgÀ¨ÉÃPÀÄ.  ªÉÊAiÀÄQÛPÀªÁV ¸ÀéAiÀÄA GzÉÆåÃUÀªÀ£ÀÄß PÉÊUÉƼÀî®Ä MlÄÖ AiÉÆÃd£Á ªÉZÀÑ gÀÆ.2.00 ®PÀëUÀ¼À¶ÖgÀÄvÀÛzÉ.  ªÉÊAiÀÄQÛPÀ ¸ÀéAiÀÄA GzÉÆåÃUÀªÀ£ÀÄß PÉÊUÉƼÀî®Ä GzÉÆåÃUÀzÀ ¸ÁÜ¥À£ÉUÁV ¨ÁåAPï ¸Á®zÀ ªÉÄÃ¯É §rØzÀgÀ ±ÉÃ.7QÌAvÀ ªÉÄîànÖzÀÝgÉ §rØ ¸ÀºÁAiÀÄzsÀ£À (Interest Subsidy) zÉÆgÉAiÀÄÄvÀÛzÉ. ¸ÀzÀj Interest Subsidy AiÀÄ£ÀÄß PÁ®PÁ®PÉÌ ¸ÀjAiÀiÁV ¸Á®ªÀ£ÀÄß ªÀÄÄgÀÄ¥ÁªÀw¸ÀĪÀ ªÀåQÛUÀ½UÉ ªÀiÁvÀæ ¤ÃqÀ¯ÁUÀĪÀÅzÀÄ.  ¨sÁgÀwÃAiÀÄ j¸Àªïð ¨ÁåAPï£À ¸ÀÄvÉÆÛÃ¯É ¸ÀASÉå: RPCD.SME & NFS. BC. No.79/06.02.31/2009-10 dated:06.05.2010gÀAvÉ jÃ.10.00 ®PÀëzÀªÀgÉUÉ AiÀiÁªÀÅzÉà jÃwAiÀÄ ªÉÄïÁzsÁgÀ (collateral) CªÀ±ÀåPÀvÉ EgÀĪÀÅ¢®è. (¥Àæw C£ÀħAzsÀ-I-A gÀ°è ®UÀwÛ¹zÉ)  Interest Subsidy AiÀÄ£ÀÄß ¥ÀqÉAiÀÄ®Ä ¨ÁåAPÀÄUÀ¼ÀÄ C£ÀħAzsÀ-I-B gÀ°è ®UÀwÛ¹gÀĪÀ £ÀªÀÄÆ£ÉAiÀÄ°è ªÀiÁ»wAiÀÄ£ÀÄß ¤ÃqÀvÀPÀÌzÀÄÝ.  ¸ÀéAiÀÄA GzÉÆåÃUÀªÀ£ÀÄß PÉÊUÉƼÀî®Ä vÉUÉzÀÄPÉÆAqÀ ¸Á®ªÀ£ÀÄß DgÀA©üPÀ 6 jAzÀ 18 wAUÀ¼ÀªÀgÉUÉ ¸Á®ªÀ£ÀÄß ªÀÄÄgÀÄ¥ÁªÀw¸ÀĪÀAw®è. £ÀAvÀgÀ ¨ÁåAQ£À ¤AiÀĪÀÄUÀ¼À£ÀéAiÀÄ 6 jAzÀ 7 ªÀµÀðzÀªÀgÉUÉ vÉUÉzÀÄPÉÆAqÀ ¸Á®ªÀ£ÀÄß ªÀÄÄgÀÄ¥ÁªÀw¸ÀĪÀÅzÀÄ." 9. The said guidelines also relate to group loans, which are not necessary for the purpose of the present matter. 10. A careful reading of the guidelines governing individual self-employment loans makes the position clear. The scheme provides financial assistance only for the purpose of self-employment. An applicant must be at least 18 years of age at the time of applying. The maximum amount that can be - 7 - HC-KAR NC: 2026:KHC:6636 WP No. 6492 of 2019 sanctioned under the scheme is ₹2,00,000/-. It is further provided that if the rate of interest charged exceeds 7% per annum, the excess interest component would be borne by way of subsidy by the Government. Significantly, the guidelines state that no collateral security is required for the loan sanctioned under the scheme. 11. It is this aspect relating to collateral security that learned counsel for the petitioner seeks to rely upon. The contention advanced is that since the Reserve Bank of India (RBI) has issued directions that loans up to ₹10,00,000/- need not be supported by collateral security, the petitioner is entitled to claim a loan of ₹10,00,000/- under the scheme without furnishing security. 12. This argument proceeds on a misunderstanding of the RBI circular. The RBI has not directed that loans of ₹10,00,000/- must be granted. What the RBI has provided is only that, where banks sanction loans up - 8 - HC-KAR NC: 2026:KHC:6636 WP No. 6492 of 2019 to ₹10,00,000/-, they need not insist upon collateral security. The RBI guideline concerns waiver of collateral requirement up to a certain ceiling; it does not mandate that every scheme must provide loans up to ₹10,00,000/-. Nor does the RBI have the authority to compel a State Government to extend financial assistance beyond the limits fixed under its own scheme. 13. The self-employment programme in question is a scheme framed and funded by the State Government. The financial burden is borne by the State. It is therefore within the exclusive domain of the State Government to determine the eligibility conditions, the ceiling amount, and the manner in which the scheme is to be implemented. The Court cannot enlarge the scope of the scheme beyond what has been provided in the guidelines. 14. Under the present scheme, the State has consciously fixed the upper limit at ₹2,00,000/- per individual - 9 - HC-KAR NC: 2026:KHC:6636 WP No. 6492 of 2019 applicant. Since this amount is well within the RBI’s collateral-free threshold, no collateral security is required to be furnished for such loan. The RBI exemption operates only to the extent that banks cannot insist on collateral for loans within that limit. It does not enlarge the quantum of loan available under the State scheme. 15. Therefore, any person seeking a self-employment loan under this programme is entitled only to ₹2,00,000/- without furnishing collateral security, subject to the applicable interest condition. If the interest charged exceeds 7% per annum, the excess portion may be reimbursed by way of subsidy in accordance with the scheme. Beyond this, no right can be claimed. 16. In view of the above, the petitioner is not entitled to a loan of ₹10,00,000/-. The entitlement is restricted to ₹2,00,000/-, which the respondents have expressed their willingness to sanction in accordance - 10 - HC-KAR NC: 2026:KHC:6636 WP No. 6492 of 2019 with the scheme. The endorsement issued at Annexure-F is consistent with the governing guidelines and does not suffer from any legal infirmity. It therefore does not call for interference. 17. As such, I pass the following: ORDER i) Writ petition stands dismissed, directing respondents to release the aforesaid sum of ₹2,00,000/- to the petitioner on the petitioner complying with the due formalities within 60 days of such compliance. Sd/- (SURAJ GOVINDARAJ) JUDGE KTY List No.: 1 Sl No.: 8