Karnataka HC ruled that an order giving effect to Tribunal directions passed after three-month limit under Section 153(5) is time-barred. Court upheld refund of ₹4.73 crore with interest under Sections 244A(1)(b) and 244A(1A).
The Karnataka High Court ruled that a bank is bound to comply with an Arbitral Tribunal’s order, such as freezing an account, without requiring separate execution proceedings. The key takeaway is that a bank’s compliance with a direct arbitral directive is lawful and not contingent on a civil court’s enforcement order.
The Karnataka High Court affirmed the legality of an ED arrest made in Sikkim concerning a Bengaluru-registered money-laundering case. The ruling establishes that PMLA confers pan-India jurisdiction on the ED, making the geographical location of the arrest irrelevant if a valid ECIR exists.
Court upheld Canara Bank’s decision to permanently cut a retired Chief Manager’s pension for issuing an unauthorised ₹300 crore manual LoC, ruling that grave misconduct proceedings can continue post-retirement under Bank Regulations 43 and 45.
Karnataka High Court granted anticipatory bail in a PMLA case noting that the predicate offence was still under police investigation and the accused was already on regular bail, making further custodial interrogation unnecessary.
Karnataka High Court held that banks cannot refuse to produce original mortgage documents when a property transaction is under police investigation for forgery or impersonation. Court clarified that holding documents as security does not exempt banks from cooperation under Section 94 of BNSS, 2023. Canara Bank’s plea against the police notice was dismissed, ensuring transparency in fraud investigations.
Karnataka High Court ruled that rejecting a compassionate appointment solely because applicant is a married daughter is discriminatory. Court held that marital status is not a valid ground for exclusion under Article 14. It directed Bank to reconsider case based on actual dependency and financial hardship.
Karnataka High Court set aside a FEMA show-cause notice and complaint issued after Section 6(3)(b) of Act was omitted by Finance Act, 2015. Court ruled that proceedings based on a non-existent provision are void ab initio. It reaffirmed that, without a saving clause, authorities lack jurisdiction to act under an omitted section.
Karnataka High Court directed that no coercive measures be taken against borrowers until their recall plea is decided by DRT. Court emphasized that issues of improper service of notice must be adjudicated before recovery is enforced. The ruling safeguards borrowers’ right to be heard in debt recovery proceedings.
Karnataka High Court held that Enforcement Directorate cannot attach assets mortgaged to banks under SARFAESI Act. Court found that such properties, acquired through lawful bank loans, are not proceeds of crime. It reaffirmed that secured creditors’ recovery rights under SARFAESI override PMLA proceedings where the bank is a victim, not a beneficiary.
