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IN THE HIGH COURT OF KARNATAKA AT BENGALURU

DATED THIS THE 23^RD DAY OF DECEMBER, 2021

PRESENT

THE HON'BLE MR. RITU RAJ AWASTHI, CHIEF JUSTICE

AND

THE HON’BLE MR. JUSTICE SACHIN SHANKAR MAGADUM

WRIT APPEAL NO. 1305 OF 2021(GM-RES)

BETWEEN:

THE AUTHORISED OFFICER

KARNATAKA BANK

ASSET RECOVERY MANAGEMENT BRANCH

3^RD FLOOR, KARANTAKA BANK BUILDING

KODIALBAIL, MANGALORE 575003

D K DISTRICT.

...APPELLANT

(BY SRI.SUDESH KUMAR ACHARYA U, ADVOCATE)

AND:

1. RAJESHWARI B SHETTY

AGED 53 YEARS

W/O K BHASKAR SHETTY

CTP NO 12292,

PRESENTLY IN PARAPPANA AGRAHARA JAIL

CENTRAL JAIL, NAGANATHAPURA

BENGALURU 560100

2. STATE OF KARNATAKA

REP BY SECRETARY

2

MINISTRY OF HOME AFFAIRS

VIDHANA SOUDHA

BENGALURU 560001

3. M/S DURGA INTERNATIONAL

S NO 114-B2

NEAR CITY BUS STAND

SHIRIBEEDU, UDUPI 576101

REP BY ITS MANAGER

…RESPONDENTS

(BY SMT.SANDHYA.U.PRABHU, ADVOCATE FOR R1;

SRI.S.S.MAHENDRA, AGA FOR R2)

THIS WRIT APPEAL FILED U/S 4 OF THE KARNATAKA HIGH

COURT ACT PRAYING TO SET ASIDE THE IMPUGNED ORDER DATED

08.11.2021 PASSED IN WP NO.19509/2021 (GM) ON THE FILE OF

THE LEARNED SINGLE JUDGE OF THIS HONBLE COURT.

THIS APPEAL HAVING BEEN HEARD AND RESERVED FOR

JUDGMENT ON 17.12.2021, COMING ON FOR PRONOUNCEMENT OF

JUDGMENT

THIS

DAY,

SACHIN

SHANKAR

MAGADUM J.,

DELIVERED THE FOLLOWING:

JUDGMENT

The captioned intra Court appeal is filed by the Bank

assailing the interim order dated 8.11.2021 passed by the

learned Single Judge in W.P.No.19509/2021.

2.

The

appellant-Bank

has

initiated

recovery

proceedings under the provisions of the Securitization and

Reconstruction of Financial Assets and Enforcement of Security

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Interest Act, 2002 (for short "SARFAESI Act"). The appellant-

Bank by having recourse to Section 13(4) of the SARFAESI Act

has taken symbolic possession of the mortgaged properties.

In continuation of the said proceedings, the appellant-bank

has issued a public auction notice. The said public auction

notice was challenged by respondents No.1 and 3 before the

Debt Recovery Tribunal(for short "DRT"), Bengaluru. The DRT

granted conditional order and since respondent No.1 failed to

comply the conditional order, the appeal filed by the

respondents was dismissed. Pursuant to dismissal of the

appeal by the DRT, the appellant Bank issued a public auction

notice by issuing a sale noticed dated 14.7.2020 and the date

of public auction was fixed on 26.8.2020. The appellant claim

that the said public auction did not attract any bidders and

therefore, Bank could not finalize the auction sale process.

Even the third auction process was again deferred on account

of want of bidders.

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3.

The appellant-Bank took out a fresh public auction

process by issuing notice on 27.8.2021 and the said public

notice was challenged by respondent No.1 in W.P.16659/2021.

The learned Single Judge has stayed the said sale notice dated

27.08.2021 deferring the public auction subject to the

condition that respondent No.1 deposits a sum of Rs.25 lakhs

by way of first installment within a period of two weeks and

the second installment within a period of another two weeks.

The appellant Bank contends that, however, the later part of

the order which required respondent No.1 to deposit second

installment of Rs.25 lakhs was not complied with. It is in this

background that the appellant-Bank on account of failure on

the part of respondent No.1 in not complying the conditional

order granted by the writ Court in W.P.16659/2021 has issued

a fresh sale notice on 16.10.2021 notifying the date of public

auction as 2.11.2021.

4.

This

public

auction

is

again

questioned

by

respondent

No.1

before

the

learned

Single

Judge

in

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W.P.19509/2021. The learned Single Judge has granted

interim order, not to confirm the auction said to have been

conducted

on

2.11.2021

recording

the

undertaking

of

Respondent No.1