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2026 Supreme(Online)(Kar) 22132
IN THE HIGH COURT OF KARNATAKA AT BENGALURU
Lalitha Kanneganti, J
Ramalakshmi – Appellant
Versus
Karnataka Gramin Bank – Respondent
WP No. 7143 of 2026 | WRIT PETITION NO. 7143 OF 2026 (GM-DRT)
For the Appellants/Petitioners: P.N. Nanja Reddy
For the Respondents: T.P. Muthanna
A court cannot issue a writ of mandamus to compel a bank to grant a One Time Settlement (OTS) scheme, although it may direct the bank to consider a petitioner's representation if such a scheme is available.
Headnote:(A) SARFAESI Act - E-Auction Notice - Infructuousness - Where an auction fails to proceed due to a lack of bidders, the challenge to the auction notice becomes infructuous as nothing survives for consideration.
(B) Banking Law - One Time Settlement (OTS) - Mandamus - A writ of mandamus cannot be issued to compel a bank to provide a One Time Settlement scheme; however, the petitioner remains at liberty to submit a representation for the bank to consider in accordance with law.
Issues: Whether a writ of mandamus can be issued to compel a bank to provide a One Time Settlement (OTS) scheme.
THIS WP IS FILED UNDER ARTICLES 226 AND 227 OF THE CONSTITUTION OF INDIA PRAYING TO A) ISSUE A WRIT OF CERTIORARI OR ANY OTHER APPROPRIATE WRIT, ORDER QUASHING THE E-AUCTION/SALE NOTICE OF IMMOVABLE PROPEERTIES BY INVITING PUBLIC AUCTION UNDER RULES 8(6) AND 9 (IMMOVABLE) OF THE SECURITY INTEREST (ENFORCEMENT) RULES 2002 DATED 10.02.2026/11.02.2026 (ANNEXURE-P) PASSED BY THE 1ST RESPONDENT AS THE SAME IS ILLEGAL, ARBITRARY AND CONTRARY TO THE PROVISIONS OF SARFAESI Act 2002 AND THE RULES MADE THEREUNDER ALSO IN VIOLATION OF PRINCIPLES OF NATURAL JUSTICE.
THIS PETITION, COMING ON FOR PRELIMINARY HEARING, THIS DAY, ORDER WAS MADE THEREIN AS UNDER:
CORAM: HON'BLE SMT. JUSTICE LALITHA KANNEGANTI
ORAL ORDER
The writ petition is filed seeking the following prayer:
(a) Issue a writ of certiorari or any other appropriate writ, order quashing the e-auction / sale notice of immovable properties by inviting public auction under Rules 8(6) & 9 (Immovable) of the Security Interest (Enforcement) Rules 2002 dated 10.02.2026 / 11.02.2026 (Annexure-P) passed by the 1st respondent as the same is illegal, arbitrary and contrary to the provisions of SARFAESI Act 2002 and the Rules made thereunder also in violation of principles of natural justice insofar as petitioner concerned only.
(b) Issue a writ of mandamus or any other appropriate writ direction or directing to the respondent bank adhering to the OTS scheme offered by it and petitioners will be abide to it and direct the bank to return / restore the properties to be auctioned and grant of all the consequential benefits consequent upon quashing the orders at Annexure-N.
Learned counsel appearing for the respondent / bank submits that for the want of bidders, they could not proceed with the auction dated 10.02.2026. Hence, the writ petition has become infructuous.
Learned counsel appearing for the petitioners submits that the another prayer sought before this court is seeking a direction to adhere to the OTS scheme offered by it and there may be a direction to respondent / bank to consider the case of the petitioner under the One Time Settlement scheme.
Having heard the learned counsels on either side and perused the entire material on record. As far as prayer No.(a) is concerned, as the auction could not take place nothing survives for consideration. As far as prayer (b), this court is of the view that there cannot be mandamus to the bank to provide the One Time Settlement scheme. If the One Time Settlement scheme is available, the petitioner is at liberty to make his representation and the respondent / bank shall consider the same in accordance with law.
Accordingly, writ petition is disposed of
All I.As. in the writ petition shall stand closed.
