An affected party is not entitled to relief if they are aware of legal proceedings and fail to participate, demonstrating that public notice can suffice in certain cases.

JUDGMENT :

ANU SIVARAMAN, J.

This Miscellaneous First Appeal is filed against the final order dated 09.01.2024, passed by the XCI Additional City Civil and Sessions Judge, Bengaluru ('Special Court' for short) in Misc.No.1204/2023. By the said impugned order, the Special Court made the ad-interim order of attachment of properties, including the property on which the appellant's school is situated, absolute.

2. We have heard Shri. D.R. Ravishankar, learned senior counsel as instructed by Shri. Siddarth U.B, learned advocate appearing for the appellant, Shri. Veeresh R. Budihal, learned counsel appearing for respondent No.1 and Shri. Shreeram T. Nayak, learned counsel appearing for respondent No.3.

3. It is submitted that the appellant, a registered Educational Trust operates a school in a property taken on 30 year lease from respondent No.3 by a registered lease agreement dated 05.03.2016.

4. Respondent No.1 - Competent Authority initiated proceedings under the Karnataka Protection of Interest of Depositors in Financial Establishments Act, 2004 ('KPIDFE Act' for short) against respondent No.3 for his role in a financial establishment. In these proceedings, the government issued a notification dated 30.08.2023 attaching various properties, including the land leased to the appellant.

5. The Competent Authority filed an application under Section 5 (2) of the KPIDFE Act as Misc.No.1204/2023 before the Special Court to make the attachment, absolute. Though, the conduct of the School in the premises was known to the Competent Authority, the appellant was not made a party to the proceedings. The Special Court passed the impugned order making the attachment absolute. Based on the said order, the Competent Authority issued a notice dated 25.04.2025 to the appellant to vacate the school premises. This appeal has been filed on receipt of the said notice.

6. It is contended by the learned senior counsel appearing for the appellant that the order which is passed without making the appellant a party is violative of the principles of natural justice and is void in law. It is also contended that the Competent Authority had actual knowledge of the fact that the appellant was in possession of the premises as a lessee and that therefore, the refusal to implead the appellant was deliberate. It is further contended that public notice is not a substitute for direct notice to the appellant.

7. The learned senior counsel would also contend that since the lease agreement was executed on 05.03.2016 and since the property was in the possession of the appellant, an order of confirmation of attachment could not have been passed without the appellant being in the party array. It is further submitted that the school is a running concern and that the future of approximately 450 students and 25 teaching and 17 non-teaching staffs are put at risk due to the wrong orders.

8. In support of the legal contentions urged, the learned senior counsel would place reliance on the following decisions:-

• Bangalore Medical Trust v. B.S. Muddappa reported in (1991) 4 SCC 54 ;

• Harshad Govardhan Sondagar v. International Assets Reconstruction Company Limited and Others reported in (2014) 6 SCC 1 ; and

• State of Uttar Pradesh v. Sudhir Kumar Singh and Others reported in (2021) 19 SCC 706 .

9. In reply, the learned counsel appearing for respondent No.1 - Competent Authority would submit that, the very contention of the appellant that it had entered into a registered Lease Deed on 05.03.2016 for a period of 30 years for a