Bengaluru dispute: Karnataka High Court orders status quo; ₹85,000 Canara Bank mortgage disputed | Today’s news
Bengaluru (Karnataka) (India), Sep 3 (ANI): The Karnataka High Court has ordered the parties to maintain status quo over a disputed plot of land and barred the creation of third-party rights till the next hearing in a case involving competing claims over property that the Karnataka Industrial Areas Development Board (KIADB) claims was acquired for its purposes.
The proceedings also brought before the court questions raised in a suit relating to a mortgage transaction involving Canara Bank, pursuant to which title deeds relating to immovable property were allegedly deposited to secure credit facilities pooling ₹85 million.
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The lawsuit also questioned the bank’s subsequent handling of the transaction. Royal Fragrances Pvt Ltd complained to Canara Bank and other authorities on May 11, 2026. According to the petition, Canara Bank acknowledged the complaint on May 13 but said in a June 1 communication that it was unable to identify the loan or trace the mortgage details. The petitioner submitted these communications to the court and challenged the bank’s conduct in handling his complaint.
Justice MI Arun passed the interim order on August 29 while hearing a petition filed by Royal Fragrances Pvt Ltd. The dispute is over 18 guntas of land in Devarabisanahalli village, Varthur Hobli, Bengaluru East Taluk.
According to the petition, the chronology of events related to the property is central to the dispute. The final notification to acquire the land was issued on 23 February 2004 under the provisions of the Karnataka Industrial Areas Development Board Act.
Royal Fragrances contended that the land vested absolutely in the State after the acquisition proceedings and that no such transfer was encumbered under Section 28(5) of the KIADB Act.
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The petition states that more than eight years later, on October 22, 2012, title deeds relating to the same 18-gunta parcel were deposited with the Canara Bank Marathahalli branch to secure credit facilities pooling ₹85 million.
The petitioner disputed the mortgage transaction on the grounds that, according to his case, the land already belonged to the state after the acquisition procedure.
In its statement of objections filed in the High Court on August 28, KIADB contends that the land was acquired for board purposes, including development of an IT/Software park.
Among other things, Royal Fragrances sought disclosure of documents relating to the bank’s ownership verification and appraisal process in relation to the credit facilities. The petition cites documents including a search report, certificate of title and easement records allegedly considered during the transaction.
The Petitioner also disputed the registered discharge deed executed on June 18, 2022 after the discharge of the loan, pursuant to which the title deeds were allegedly returned to the legal heirs of the original owner of the land.
During the hearing, Royal Fragrances stated that despite the acquisition proceedings, the respondents Nos. 5 to 8 allegedly continued to dispose of the property and create or attempt to create third party rights over it.
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Counsel appearing for respondent Nos. 5 to 8 contested the petitioner’s version of the legal status of the land. It was contended that although the property was initially notified for acquisition, it was subsequently de-registered on the basis of court orders which, according to the respondents, became final.
The respondents claimed that they were the rightful owners of the property and were entitled to dispose of it in accordance with the law.
On the other hand, KIADB in its notice of objections insists that the lands were acquired for its purposes.
The High Court took cognizance of the competing views on the status of the property and said the matter required assessment.
The court observed that in view of the submissions made, including the position of the KIADB regarding the acquisition of the lands, the interests of justice would be served by maintaining the current position pending further hearing.
Accordingly, the High Court directed the parties to maintain the status quo in respect of the property and restrained them from creating any third party rights till the next date of hearing.
The matter was listed for further hearing on September 19. (OR)
Disclaimer: This story was published from the agency’s news feed without editing the text. Only the title was changed.
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