Karnataka High Court
Sri Balaji And Co vs Pnb Housing Finance Limited on 12 June, 2025
Author: S.Sunil Dutt Yadav
Bench: S.Sunil Dutt Yadav
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NC: 2025:KHC:20175
WP No. 13712 of 2025
HC-KAR
IN THE HIGH COURT OF KARNATAKA AT BENGALURU
DATED THIS THE 12TH DAY OF JUNE, 2025
BEFORE
THE HON'BLE MR JUSTICE S SUNIL DUTT YADAV
WRIT PETITION NO. 13712 OF 2025 (GM-RES)
BETWEEN:
1. SRI BALAJI AND CO
A PARTNERSHIP FIRM,
HAVING ITS OFFICE AT:
NO.34, 1ST MAIN ROAD,
SHESHADRIPURAM,
BANGALORE-560 020
REPRESENTED BY ITS PARTNER
SRI.S.K.DEVENDRA,
AGED ABOUT 47 YEARS,
SON OF LATE SRI.S.R. KRISHNAM RAJU,
2. S.K.DEVENDRA
AGED ABOUT 47 YEARS,
Digitally
signed by PARTNER OF SRI BALAJI AND CO.
VIDYA G R
Location: SON OF LATE SRI.S.R.KRISHNAM RAJU,
HIGH
COURT OF R/AT NO.444, 11TH CROSS,
KARNATAKA
SADASIVANAGAR,
BENGALURU-560 080.
... PETITIONERS
(BY SRI. S JAGAN BABU., ADVOCATE)
AND:
1. PNB HOUSING FINANCE LIMITED
A COMPANY INCORPORATED UNDER
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WP No. 13712 of 2025
HC-KAR
COMPANIES ACT, 1956,
AND DULY REGISTERED WITH
NATIONAL HOUSING BANK,
AS A HOUSING FINANCE COMPANY,
IS HAVING ITS REGISTERED OFFICE AT
9TH FLOOR, ANTRIKSH BHAVAN,
22 KASTURBA GANDHI MARG,
CONNAUGHT PLACE,
NEW DELHI - 110 001
REPRESENTED BY ITS
AUTHORIZED REPRESENTATIVE
2. PNB HOUSING FINANCE LIMITED,
REPRESENTED BY ITS
AUTHORIZED PERSON AND MANAGER.
HAVING ITS BRANCH OFFICE AT:
NO.40, JODH TOWER,
27TH CROSS ROAD, JAYANAGAR,
BANGALORE-560 011.
... RESPONDENTS
(BY SRI. FRANCIS XAVIER., ADVOCATE FOR R1 & R2)
THIS W.P. IS FILED UNDER ARTICLES 226 AND 227 OF
THE CONSTITUTION OF INDIA, PRAYING TO QUASH THE
PURPORTED AUCTION AND ALL ACTIONS TAKEN IN
PURSUANCE THEREOF INCLUDING SALE CERTIFICATE
ISSUANCE AND ETC.
THIS PETITION COMING ON FOR ORDERS THIS DAY,
ORDER WAS MADE THEREIN AS UNDER:
CORAM: HON'BLE MR JUSTICE S SUNIL DUTT YADAV
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WP No. 13712 of 2025
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ORAL ORDER
Present petition has been filed seeking to set aside the actions taken in pursuance of the auction including the sale certificate. The petitioner has also sought for issuance of writ of mandamus directing the respondent to re-conduct the auction proceedings.
2. Petitioner states that there is a case made out as per the pleadings for conducting re-auction as the property has been sold at a grossly undervalued price, which is much less than the market price, which has caused serious prejudice to the petitioner.
3. Learned counsel for the respondents submits that sale confirmation is complete but issuance of sale certificate has been stayed. He further submits that the substantive remedy ought to have been sought for before the Debts Recovery Tribunal.
4. Heard both sides.
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5. In light of the contentions raised it is relevant to take note of the observations of the Apex Court in the case of Union Bank of India v. Satyawati Tondon and Others - (2010) 8 SCC 110 that the appropriate remedy would be to relegate the petitioner to seek for substantive remedy before the Debt Recovery Tribunal. The relevant observations of the Apex Court are as follows:
"43. Unfortunately, the High Court overlooked the settled law that the High Court will ordinarily not entertain a petition under Article 226 of the Constitution if an effective remedy is available to the aggrieved person and that this rule applies with greater rigour in matters involving recovery of taxes, cess, fees, other types of public money and the dues of banks and other financial institutions. In our view, while dealing with the petitions involving challenge to the action taken for recovery of the public dues, etc. the High Court must keep in mind that the legislations enacted by Parliament and State Legislatures for recovery of such dues are a code unto themselves inasmuch as they not only contain comprehensive procedure for recovery of the dues but also envisage constitution of quasi- judicial bodies for redressal of the grievance of any -5- NC: 2025:KHC:20175 WP No. 13712 of 2025 HC-KAR aggrieved person. Therefore, in all such cases, the High Court must insist that before availing remedy under Article 226 of the Constitution, a person must exhaust the remedies available under the relevant statute.
44. While expressing the aforesaid view, we are conscious that the powers conferred upon the High Court under Article 226 of the Constitution to issue to any person or authority, including in appropriate cases, any Government, directions, orders or writs including the five prerogative writs for the enforcement of any of the rights conferred by Part III or for any other purpose are very wide and there is no express limitation on exercise of that power but, at the same time, we cannot be oblivious of the rules of self-imposed restraint evolved by this Court, which every High Court is bound to keep in view while exercising power under Article 226 of the Constitution.
45. It is true that the rule of exhaustion of alternative remedy is a rule of discretion and not one of compulsion, but it is difficult to fathom any reason why the High Court should entertain a petition filed under Article 226 of the Constitution and pass interim order ignoring the fact that the petitioner can avail effective alternative remedy by -6- NC: 2025:KHC:20175 WP No. 13712 of 2025 HC-KAR filing application, appeal, revision, etc. and the particular legislation contains a detailed mechanism for redressal of his grievance.
55. It is a matter of serious concern that despite repeated pronouncement of this Court, the High Courts continue to ignore the availability of statutory remedies under the DRT Act and the Sarfaesi Act and exercise jurisdiction under Article 226 for passing orders which have serious adverse impact on the right of banks and other financial institutions to recover their dues. We hope and trust that in future the High Courts will exercise their discretion in such matters with greater caution, care and circumspection."
6. In light of the observations made by the Apex Court, it can be noticed that several factual contention raised by the petitioner are the matters that cannot be adjudicated in the present proceedings.
7. Accordingly, the petition is disposed off relegating the petitioners to avail of the substantive remedy as regards the impugned proceedings. All contentions of both the sides are kept open. -7-
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8. In light of disposal of writ petition, it would meet the ends of justice by directing the respondent- bank not to take any precipitative steps for a period of three weeks from today. The interim protection granted under this order is only to enable the petitioner to avail of the substantive remedy and must not be considered to be an order passed on the basis of adjudication on merits. Upon the lapse of the time stipulated, the protection granted would cease to operate and the authorities before whom petitioner may approach are to look at the matter afresh uninfluenced by the observations made herein.
9. Needless to state that while considering the aspect of limitation in the event the proceedings are instituted before the DRT, time spent before this Court may be taken note of appropriately.
10. Writ petition is disposed off accordingly.
SD/-
(S SUNIL DUTT YADAV) JUDGE VP