A belated deposit claim cannot be rejected at threshold on disputed proof of depositor status.

The appellant claimed to have deposited ₹3,50,000 with M/s. Harsha Entertainment Ltd. in 2016 and 2017. After the establishment defaulted, proceedings were initiated under the Karnataka Protection of Interest of Depositors in Financial Establishments Act, 2004 (KPIDFE Act), and a public notice invited claims by 26 May 2026.

The appellant said she learned of the notice shortly before the deadline and, citing age-related difficulties and delay in retrieving records, filed a claim on 4 July 2026—approximately 35 days late. The Special Court dismissed her application under Section 11(2), finding insufficient evidence that she was a depositor, including the absence of a deposit certificate, bond, or agreement. She appealed under Section 16 of the KPIDFE Act.

Whether the appellant’s delayed claim under Section 11(2) of the KPIDFE Act should be accepted

Whether the Special Court could reject the application at the threshold on the ground that the appellant had not established depositor status, rather than accepting the delayed claim and considering its merits thereafter

Section 11(2) of the KPIDFE Act provides the basis for seeking permission to submit a belated claim.

Section 2(3) defines a “Depositor” as “a person who has made deposits with Financial Establishment”.

The Court reasoned that the request to submit a late claim should be considered separately from the merits of whether the claimant made a qualifying deposit; the claim’s evidentiary sustainability is to be assessed in the ensuing proceedings.

The claim was about 35 days late, and the appellant attributed the delay to lack of awareness of the notice, her age-related difficulties, and the time needed to retrieve records.

The High Court held that the Special Court had conflated the request to accept a belated claim with the substantive question of depositor status. It noted the appellant’s notarised bank statements and the material concerning the alleged deposit, while treating the validity and sufficiency of that evidence as matters for consideration on the merits. The Special Court therefore erred in rejecting the application at the initial stage.

It directed that the belated claim be accepted and the proceedings continue in accordance with law, expressly leaving the merits undecided.