R.M.S. Granites Private Limited & Ors. Vs Authorised Officer (Karnataka High Court)
Summary: The Karnataka High Court considered a review petition filed by M/s R.M.S. Granites (P) Ltd., its Managing Director Raju Ovan and Director Saraswathi Raju seeking review of the judgment dated 28 October 2021 in W.P. No. 1583/2017. The dispute concerned the excess amount realised from the sale of the company’s property by Karnataka Bank. During the review proceedings, the petitioners submitted that both directors had furnished affidavits undertaking to withdraw their challenge to the sale already conducted by the bank. They consequently requested refund of ₹1,11,90,354.32, which was stated to be retained by the bank after recovery of its dues.
The respondent bank opposed the petitioners’ request. After considering the submissions and examining the record, the High Court observed that the entire amount due to the bank had already been recovered and that ₹1,11,90,354.32 remained in deposit with the bank. The Court found no justification for the bank to retain the excess amount without authority.
Accordingly, the High Court directed Karnataka Bank to refund ₹1,11,90,354.32 along with applicable interest from 20 September 2010 within one week and disposed of the review petition. Subsequently, the Supreme Court, in its order dated 12 November 2024, modified the interest direction and ordered interest at 9% per annum from 28 October 2021. Thus, the Karnataka High Court’s original direction regarding the commencement of interest must be read subject to the subsequent Supreme Court order.
Related Reading: The Supreme Court subsequently examined the interest payable on ₹1.11 crore in excess auction proceeds retained by the bank and fixed the rate at 9%. Read: Supreme Court Fixes 9% Interest on ₹1.11 Crore Excess Auction Proceeds Retained by Bank.
FULL TEXT OF THE JUDGMENT/ORDER OF KARNATAKA HIGH COURT
This petition has been filed seeking review of the judgment dated 28.10.2021 passed by this Court in W.P.No.1583/2017 by which the writ petition preferred by the petitioner has been dismissed.
2. Learned counsel for the petitioner, while inviting the attention of this Court to affidavits of both the Directors of petitioner No.1 – Company, submitted that they undertake to withdraw the challenge to the sale which has already been conducted by respondent No.1. It is therefore, submitted that excess amount which has been released by the Bank by sale of property of petitioner amounting to Rs.1,11,90,354.32p. which is admittedly lying in deposit with the respondent – Bank be refunded to the petitioner.
3. Learned counsel for the respondent – Bank has opposed the submission made by the learned counsel for the petitioner.
4. We have considered the submissions made on both sides and have perused the record. Taking into account the fact that the entire amount of dues has been recovered by the respondent No.1 – Bank from the petitioner and an amount of Rs.1,11,90,354.32p. is lying in deposit with the respondent No.1 – Bank, we see no justification as to why the amount should be illegally retained by the respondent No.1 – Bank without any authority. The respondent No.1 – Bank is therefore directed to refund the amount of Rs.1,11,90,354.32p. along with applicable interest w.e.f. 20.09.2010 within a period of one week.
Accordingly, the review petition is disposed of.
