M/s. DHANURDHARINI POLYMERS PVT. LTD., NO.37/12-1, ARCHANA COMPLEX v. STATE BANK OF INDIA

(BY SRI. PARAS JAIN, ADVOCATE) AND: …PETITIONER STATE BANK OF INDIA (FORMERLY SBM) STRESSED ASSETS RESOLUTION CENTRE, 1ST FLOOR, BKG COMPLEX, III BLOCK, AVENUE ROAD, BENGALURU 560 009. REP. BY ITS AUTHORISED OFFICER (BY SRI. SATHISH KUMAR J., ADVOCATE) …RESPONDENT - 2 - NC: 2024:KHC:35749 WP No. 53482 of 2017 C/W WP No. 52607 of 2017 WP No. 4379 of 2021 THIS WRIT PETITION IS FILED UNDER ARTICLES 226 & 227 OF THE CONSTITUTION OF INDIA PRAYING TO DIRECT TO RESPONDENT BANK PAY TO THE PETITIONER INTEREST ACCRUED ON FD CERTIFICATE NO.507059 DATED 14.09.2015 FOR A SUM OF RS.99,50,000/- FOR A PERIOD COMMENCING FROM 13.8.2015 TO 26.7.2017 AMOUNTING TO RS.13,90,112/- CALCULATED IN ACCORDANCE WITH BANK NORMS ON FIXED DEPOSIT [COPY OF THE FIXED DEPOSIT CERTIFICATE IS FILED HEREWITH AS ANNEXURE-C TO THIS WRIT PETITION ETC. IN WP NO. 52607/2017 BETWEEN: M/s. DHANURDHARINI POLYMERS PVT. LTD., NO.37/12-1, ARCHANA COMPLEX, 4TH CROSSL, LALBAGH ROAD, BANGALORE 560 027 REP. BY ITS DIRECTOR, SMT. NUPUR RAMSISARIA AGED ABOUT 45 YEARS ...PETITIONER (BY SRI. PARAS JAIN, ADVOCATE) AND: THE AUTHORIZED OFFICER STATE BANK OF INDIA, (FORMERLY SBM), STREESSED ASSETS RESOLUTION CENTRE, 1ST FLOOR, BKG COMPLEX, III BLOCK, AVENUE ROAD, BENGALURU 560 009. ...RESPONDENT (BY SRI. SATHISH KUMAR J., ADVOCATE) - 3 - NC: 2024:KHC:35749 WP No. 53482 of 2017 C/W WP No. 52607 of 2017 WP No. 4379 of 2021 THIS WRIT PETITION IS FILED UNDER ARTICLES 226 & 227 OF THE CONSTITUTION OF INDIA PRAYING TO DIRECT TO RESPONDENT BANK TO DELIVER THE PEACEFUL POSSESSION OF THE PROPERTY BEARING MUNICIPAL CORPORATION NO.3 AND NO.3/1 LOCATED AT 3RD MAIN ROAD, 2ND BLOCK, JAYANAGAR, BANGALORE FROM THE RESPONDENT BANK, UNDER SALE CERTIFICATE DATED 27.07.2017 (ANNEXURE-C) REGISTERED AS DOCUMENT NO.04313/2017-18 IN THE OFFICE OF THE SUB- REGISTRAR, JAYANAGAR, BANGALORE AND TO PUT THE PETITIONER IN POSSESSION OF THE SAME AND TO DELIVER TO IT THE KEYS OF THE PROPERTY. IN WP NO. 4379/2021 BETWEEN: M/s.DHANURDHARINI POLYMERS PVT. LTD., NO.37/12-1, ARCHANA COMPLEX 4TH CROSS, LALBAGH ROAD BANGALORE-560027 REP. BY ITS DIRECTOR SMT NUPUR RAMSISARIA AGED ABOUT 49 YEARS ...PETITIONER (BY SRI. PARAS JAIN, ADVOCATE) AND: STATE BANK OF INDIA (FORMERLY KNOWN AS STATE BANK OF MYSORE) THE ASSISTANT GENERAL MANAGER STATE BANK OF INDIA ASSET RECOVERY MANAGEMENT BRANCH(40564) 2ND FLOOR, A BLOCK, B K G COMPLEX MYSORE BANK CIRCLE - 4 - NC: 2024:KHC:35749 WP No. 53482 of 2017 C/W WP No. 52607 of 2017 WP No. 4379 of 2021 AVENUE ROAD BANGALORE-560009, INDIA ...RESPONDENT (BY SRI. SATHISH KUMAR J., ADVOCATE) THIS WRIT PETITION IS FILED UNDER ARTICLES 226 & 227 OF THE CONSTITUTION OF INDIA PRAYING TO ISSUE WRIT OF MANDAMUS OR ORDER OR SUCH OTHER DIRECTIONS TO RESPONDENT BANK TO DELIVER THE ORIGINAL DOCUMENTS OF TITLE OF THE PROPERTY BEARING MUNICIPAL CORPORATION NO.3, LOCATED AT 3RD MAIN ROAD, 2ND BLOCK, JAYANAGAR, BANGALORE, WHICH THE RESPONDENT BANK, HAS SOLD TO THE PETITIONER UNDER SALE CERTIFICATE DATED 27.07.2017 REGISTERED AS DOCUMENT NO.04313/2017-18 IN THE OFFICE OF THE SUB-REGISTRAR, JAYANAGAR, BANGALORE (ANNEXURE-A). THESE PETITIONS, COMING ON FOR PRELIMINARY HEARING `B' GROUP THIS DAY, ORDER WAS MADE THEREIN AS UNDER: CORAM: HON'BLE MR JUSTICE M.G.S. KAMAL ORAL ORDER Common petitioner namely M/s.Dhanurdharini Polymers Pvt. Ltd., claiming to be auction purchaser of secured asset namely the immovable property bearing Municipal Corporation No.3 and 3/1 situated at 3rd Main Road, II Block, Jayanagar, Bengaluru, in a public auction conducted by respondent-bank in terms of provisions of Securitization and Reconstruction of - 5 - NC: 2024:KHC:35749 WP No. 53482 of 2017 C/W WP No. 52607 of 2017 WP No. 4379 of 2021 Financial Assets and Enforcement of Security Interest Act, 2002 having paid the entire bid amount of Rs.99,50,000/- and having been issued a sale certificate is before this Court in these writ petitions.

2. W.P.No.52607/2017 is filed seeking issue of writ of mandamus directing the respondent-bank to put the petitioner in possession of the aforesaid property and to deliver the keys.

3. W.P.No.53482/2017 is filed for direction to pay the petitioner interest accrued on fixed deposit certificate dated

14.09.2015 for a sum of Rs.99,50,000/- from 13.08.2015 to

26.07.2017 and to refund a sum of Rs.99,500/- towards the tax deducted at source under the provisions of Section 194A of Income Tax Act, 1961 and for interest on the said amount at 12% p.a. from 14.02.2017.

4. W.P.No.4379/2021 is filed seeking direction to the respondent-bank to deliver the original documents of title in respect of the aforesaid property.

5. Learned counsel for the petitioner reiterating the averments made in these writ petitions submit that: - 6 - NC: 2024:KHC:35749 WP No. 53482 of 2017 C/W WP No. 52607 of 2017 WP No. 4379 of 2021 (a) petitioner participated in the public auction conducted by the respondent-bank in selling the aforesaid property for recovery of its dues on the assurance that the respondent-bank would deliver peaceful vacant possession of the same. The respondent-bank having received the entire sale consideration of Rs.99,50,000/- is duty bound to deliver the vacant peaceful possession of the property in the light of the Judgment rendered by the Apex Court in the case of ITC Limited vs. Blue Coast Hotels Limited reported in 2018 (15) SCC 99 and other judgments, wherein it is held that the responsibility of the banks to convey right, title, interest, possession the secured assets would not be ceased even after the sale of the property. (b) petitioner had admittedly deposited a sum of Rs.99,50,000/- as on 04.07.2015. That the respondent-bank without executing and registering the sale certificate had intimated that the original borrower had filed application S.A.No.313/2015 and had obtained an interim order of stay. As such, the entire amount paid by the petitioner was kept in fixed deposit on 14.09.2015. - 7 - NC: 2024:KHC:35749 WP No. 53482 of 2017 C/W WP No. 52607 of 2017 WP No. 4379 of 2021 (c) That the application in S.A.No.313/2015 came to be dismissed on 08.06.2017 and appeal filed against the same was also dismissed. Sale certificate was issued and registered in favour of the petitioner on 27.07.2017. As such, petitioner is entitled for the interest on the said amount between 13.08.2015 to 26.07.2017 at 6.75% interest compoundable every three months. (d) That in terms of Section 194A of Income Tax Act, 1961, 1% of tax was required to be deducted by the petitioner at source. However, entire amount of Rs.99,50,000/- without deducting Rs.99,500/- was paid to the respondent-bank. Respondent-bank despite request by the petitioner for refund of said 1% amount, did not comply with the same. As such, petitioner was constrained to pay additional Rs.99,500/- directly to the credit of Union of India on 27.07.2017 to avoid any further delay in obtaining sale certificate in his favour. As such, the respondent -bank is liable to refund the said amount. (e) the respondent-bank is duty bound to return the original documents of title. - 8 - NC: 2024:KHC:35749 WP No. 53482 of 2017 C/W WP No. 52607 of 2017 WP No. 4379 of 2021

6. In response to the above, learned counsel for respondent-bank submit that proceedings before the concerned Magistrate have already been initiated under Section 14 of the Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 and certain documents are required to be furnished before the Magistrate and with the co-operation and assistance of the petitioner herein necessary orders thereon would be obtained and respondent-bank would ensure delivery of possession as required under law. The said submission is taken on record as an undertaking to this Court.

7. As regards relief of refund of TDS amount and interest learned counsel for respondent-bank submit that respondent- bank is ready and willing to refund TDS amount. However, he has objection with regard to rate of interest being claimed by the petitioner. He submits that the amount paid by the petitioner has been deposited in Fixed Deposit and bank is ready and willing to pay interest which has accrued thereon.

8. Learned counsel for petitioner has serious objection for the same. He submits for no fault of the petitioner, the entire - 9 - NC: 2024:KHC:35749 WP No. 53482 of 2017 C/W WP No. 52607 of 2017 WP No. 4379 of 2021 amount has been withheld illegally and unjustifiably by the respondent -bank. Therefore respondent-bank be directed to pay compound interest at the rate of 12% p.a. He relied upon the Judgment of the Apex Court in the case of Govind Kumar Sharma and anr Vs Bank of Baroda and others in SLP (C) No.24155 of 2018.

9. Necessary to note the Judgment of the Apex Court in the said case was rendered in the circumstances where the entire money has been refunded and there has been no issue of delivery of possession of property. In the instant case respondent-bank as already noted above has undertaken the endeavour to deliver possession of the subject property to the petitioner. In that view of the matter this Court do see any justification in petitioner claiming compound interest on the amount deposited. However, this Court is of the considered view that petitioner is entitled for simple interest at the rat eof 12% p.a. for the period claimed in the writ petition.

10. Relief in W.P.No.4379/2021 would be consequential to the performance of the aforesaid acts of delivery of vacant physical possession of the subject property. Therefore - 10 - NC: 2024:KHC:35749 WP No. 53482 of 2017 C/W WP No. 52607 of 2017 WP No. 4379 of 2021 respondent-bank shall deliver original title deeds to the petitioner as well. With the above observation in view of the submission and undertaking made by the learned counsel for respondent-bank, the writ petitions are disposed of. Needless to state that the above exercise shall be completed as undertaken by the respondent-bank within an outer limit of 90 days from the date of receipt of certified copy of this order. Sd/- (M.G.S. KAMAL) JUDGE SBN List No.: 1 Sl No.: 23