Karnataka High Court
Sri G N Manjunath vs The Competent Authority on 15 January, 2025
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NC: 2025:KHC:1556-DB
MFA No. 1214 of 2022
IN THE HIGH COURT OF KARNATAKA AT BENGALURU
DATED THIS THE 15TH DAY OF JANUARY, 2025
PRESENT
THE HON'BLE MRS. JUSTICE ANU SIVARAMAN
AND
THE HON'BLE MR. JUSTICE VIJAYKUMAR A. PATIL
MISCELLANEOUS FIRST APPEAL NO. 1214 OF 2022 (RES)
BETWEEN:
SRI. G.N. MANJUNATH
S/O G.C. NATARAJ
AGED ABOUT 51 YEARS
R/AT. No.17, KAIVALYA MARG
SIDDARTH NAGAR
NAZARABAD MOHALLA
MYSURU CITY-570 011
...APPELLANT
(BY Ms. HEENA S.A., FOR
SRI. SHARATH S. GOGI, ADVOCATE)
AND:
Digitally signed 1. THE COMPETENT AUTHORITY
by
CHANNEGOWDA FOR-INJAZ INTERNATIONAL AND
PREMA
Location: High
ASSOCIATED GROUP OF COMPANIES/
Court of REGIONAL COMMISSIONER-(REV.)
Karnataka
BENGALURU DIVISION, BENGALURU
2ND FLOOR, BMTC COMPLEX
K.H. ROAD, SHANTHI NAGAR
BENGALURU-560 027
2. INJAZ INTERNATIONAL
A PARTNERSHIP FIRM
REP. BY MANAGING PARTNER/ DIRECTOR
SUHAIL AHMED SHARIFF
S/O IQBAL PASHA
No.6, SRIVATSA ARECADE
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NC: 2025:KHC:1556-DB
MFA No. 1214 of 2022
12TH CROSS, WILSON GARDEN
BENGALURU-560 027
...RESPONDENTS
(BY SRI. VEERESH R. BUDIHAL, ADVOCATE FOR R1;
NOTICE TO R2 IS DISPENSED WITH V/O DATED
15.01.2025)
THIS MFA IS FILED UNDER SECTION 16 OF KARNATAKA
PROTECTION OF INTEREST OF DEPOSITORS IN FINANCIAL
ESTABLISHMENT ACT, 2004 AGAINST THE ORDER DATED
03.12.2021 PASSED IN MISCELLANEOUS PETITION
No.1072/2019 ON THE FILE OF THE XCI ADDITIONAL CITY
CIVIL AND SESSIONS JUDGE AND SPECIAL JUDGE FOR KPIDFE
CASES, BENGALURU, CCH-92 ALLOWING THE PETITION FILED
UNDER SECTION 5(2) OF THE KPIDFE ACT-2004.
THIS APPEAL, COMING ON FOR ORDERS, THIS DAY,
JUDGMENT WAS DELIVERED THEREIN AS UNDER:
CORAM: HON'BLE MRS. JUSTICE ANU SIVARAMAN
and
HON'BLE MR. JUSTICE VIJAYKUMAR A. PATIL
ORAL JUDGMENT
(PER: HON'BLE MRS. JUSTICE ANU SIVARAMAN)
Heard the learned counsel appearing for the appellant as
well as the learned counsel for the respondents.
2. Learned counsel for the appellant submits that the
appellant is an absolute owner in possession of the subject
property and that property was purchased by sale deed dated
23.05.2016. It is submitted that the sale consideration of
Rs.75,00,000/- was paid by way of two demand drafts; one for
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Rs.35,00,000/- dated 23.05.2016 and another for
Rs.40,00,000/- dated 21.05.2016.
3. It is the specific case of the appellant that at the
time of purchase of the property, he had contributed
Rs.35,00,000/- out of his own savings and has availed loan of
Rs.40,00,000/- from one Suhail Ahmad Shariff on interest at
the rate of 10% per annum. It is submitted that the amount
was lent by the said person in his personal capacity and that in
this manner, the purchase value had been met by the
appellant. It is further contended that the appellant was ready
and willing to repay the loan with interest, but Suhail Ahmad
Shariff refused to respond to the calls of the appellant and it
was later learnt that Suhail Ahmad Shariff is the Managing
Director of a Financial Establishment and he was wanted in a
cheating case. It is submitted that the appellant who had been
put on notice had raised all these contentions before the
Special Court, but the Special Court did not consider the
contention on the merits and the order impugned was passed
by the Special Court. It is submitted that the Special Court
failed to consider that the appellant had paid part of the sale
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consideration from his own funds and that therefore, the order
impugned is not sustainable.
4. Learned counsel appearing for the respondents on
the other hand contends that though the appellant had raised
the contention before the Special Court that part of the sale
consideration had been paid by the appellant, there was
absolutely no material whatsoever placed before the Special
Court to show that any part of the sale consideration had been
met by the appellant from his own funds. Further, it is
contended that the property in question is 1 acre 30 guntas of
land in Sathagalli village, Kasaba Hobli, Mysuru Taluk and
Mysuru District and that no materials including the income tax
returns had been produced by the appellant to substantiate his
contention that at least part of the sale consideration had been
paid from his own funds. Further, it is submitted that in the
objections filed by the financial establishment before the
Special Court, it was specifically stated as follows:
This Respondent most respectfully submits that
the Petition schedule property has been acquired on
behalf of first Respondent Company for the benefit of
its members in the name of the Second Respondent
i.e., Sri. G N Manjunath Since the First Respondent
cannot hold or acquire agricultural land directly in its
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name. The entire sale consideration to acquire this
land has been paid by the First Respondent.
5. It is further contended that the contention raised
by the appellant that he is ready and willing to pay the amount
which had been advanced by respondent No.2 along with the
interest is also not tenable in view of the fact that there is
absolutely no material before the Special Court or before this
Court to show that even a penny of the amount had been paid
by the appellant from his own resources.
6. Having considered the contentions advanced, we
notice that it is the admitted case of the appellant that
Rs.40,00,000/- of the sale consideration had been paid by
respondent No.2-Financial Establishment or atleast by the
Managing Director of the said Financial Establishment, who is
also personally liable under the provisions of the Act. Further,
we also notice that though it is contended that Rs.35,00,000/-
has been raised by the appellant from his own resources,
absolutely no material is available either before the Special
Court or before this Court, in appeal, to hold that any amount
had been expended by the appellant for purchase of property
in question.
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7. Further, it is clear that respondent No.2 had in
categorical terms pleaded that the entire sale consideration for
the purchase of property had in fact being paid by the Financial
Establishment. In the said factual circumstances, we are of the
opinion that the contentions raised by the appellant in this
appeal does not deserved to be considered. We find that the
decision of the Special Court is well founded inasmuch as all
the contentions raised by the appellant have been considered
and it has been found that there is no material to uphold the
claim of the appellant. On an anxious consideration of the
findings of the Special Court, we find no reason to differ. The
appeal is therefore fails, the same is accordingly dismissed.
The appellant, however, is permitted to withdraw an amount of
Rs.40,00,000/- with interest, which has been deposited
pursuant to the interim order of this Court dated 28.03.2022
on IA No.1/2022.
Sd/-
(ANU SIVARAMAN)
JUDGE
Sd/-
(VIJAYKUMAR A. PATIL)
JUDGE
