IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 14^TH DAY OF OCTOBER, 2025 BEFORE THE HON'BLE SMT. JUSTICE LALITHA KANNEGANTI WRIT PETITION NO. 15683 OF 2024 (GM-DRT)

BETWEEN:

1. SRI K S NAGARAJU S/O LATE A D SUBEEGOWDA AGED ABOUT 68 YEARS, COFFEE PLANTER, R/O YASHA NILAYA CHANNAPURA ROAD, KOTE VINAYAKA NAGAR, CHIKMAGALUR- 577 101 REP BY GPA HOLDER TO PETITIONER NO. 2 AND 3

2. SRI. K S MURTHY S/O LATE A D SUBBEGOWDA, AGED ABOUT 67 YEARS, COFFEE PLANTER, Digitally signed CHANNPURA ROAD, by MEGHA MOHAN KOTE VINAYAKA NAGAR, Location: HI GH CHIKMAGALUR- 577 101 COURT OF KARNATAKA

3. SRI. S VIJAYENDRA S/O LATE A D SUBEEGOWDA AGED ABOUT 64 YEARS, COFFEE PLANTER, R/O YASHA NILAY, CHANNPURA ROAD, KOTE VINAYAKA NAGAR, CHIKMAGALUR- 577 101.

…PETITIONERS (BY SRI. RAMESH BABU R., ADVOCATE)

AND:

UNION BANK OF INDIA A BODY CORPORATE CONSTITUTED UNDER THE BANKING COMPANIES (ACQUISITION AND TRANSFER OF UNDERTAKINGS) ACT, 1980 HAVING ITS HEAD OFFICE AT UNION BANK BHAVAN, 239, VIDHAN BHAVAN MARG, NARIMAN POINT, MUMBAI, MAHARASHTRA, INDIA, PIN CODE- 400021 AND HAVING AMONG OTHER BRANCHES A BRANCH AT CHIKKAMAGALUR M G ROAD, CHIKKMAGALUR- 577 101 REPRESENTED BY ITS CHIEF MANAGER.

…RESPONDENT (BY SRI. VIGNESH SHETTY, ADVOCATE)

THIS WP IS FILED UNDER ARTICLES 226 AND 227 OF THE CONSTITUTION OF INDIA PRAYING TO QUASH DEMAND NOTICE DATED 4/9/2023 BEARING NO.0812/AGRI/NPA 02/2023-24 SECTION 13(2) UNDER SARFAESI ACT AT ANNEXURE- P., AND ETC.

THIS PETITION, COMING ON FOR ORDERS, THIS DAY, ORDER WAS MADE THEREIN AS UNDER:

CORAM: HON'BLE SMT. JUSTICE LALITHA KANNEGANTI

ORAL ORDER

The present writ petition is filed to quash the Demand Notice dated 04.09.2023 which is issued under Section 13 (2)

of SARFAESI Act.

2. It is the case of the petitioners that they have borrowed loan from the respondent/Bank. Loan was sanctioned with loan Account CCCK/01/121040 on 18.09.2012 for an amount of Rs.5,56,000/- for the purpose of growing plantation crops. The interest for this loan is 10.50% per annum. The main security given to this loan is by hypothecation of crops grown on the land and as collateral security to have charge on the crops. The said land was mortgaged to the bank by deposit of title deeds on 18.09.2012 with another loan sanctioned on 25.09.2012 for an amount of Rs.10,20,000/- for the purpose of water pond and renovation of labour quarters in the land. The interest for this loan is 10.50% per annum which is repayable within 10 years in yearly installment of Rs.1,02,000/- along with interest per year for a period of 10 years from the date of sanction of loan. Loan Account CKVLY/01/140007 is the vehicle loan which was sanctioned on 29.05.2014 for an amount of Rs.11,90,000/- to purchase vehicle for the agricultural purpose.

The interest for this loan is 10.25% per annum. The security given to this loan is by hypothecation of vehicle on hire purchase terms.

3. It is the case of the petitioners that they were paying the loan installments regularly but later from 2015 onwards became defaulters due to the natural calamities. As per the RBI guidelines if one account is NPA, other loan accounts will automatically become NPA. In the year 2015 the entire crop and coffee plants were completely destroyed due to natural calamities, as such they could not pay the loan installments. It is stated that from 2015 till 2023-2024 every year continuously the petitioners' area was hit by natural calamities like draught, land slide, excess rain etc. The State Government had issued notification to that effect declaring the area as affected by natural calamity. The respondent had issued the impugned notification under Section 13(2) of the SARFAESI Act.

4. Learned counsel appearing for petitioners submits that the Demand Notice at Sl.No.1 pertains to the loan that is taken for the purpose of purchasing the vehicle, under Securitization Act they cannot recover the loan. It is submitted that Sl.Nos.2 and 3 pertains to the loan taken for the purpose of developing the coffee estate which is t