Kerala High Court
Baiju K.K vs Kerala Financial Corporation on 5 August, 2014
IN THE HIGH COURT OF KERALA AT ERNAKULAM
PRESENT:
THE HONOURABLE MRS. JUSTICE ANU SIVARAMAN
FRIDAY, THE 6TH DAY OF OCTOBER 2017/14TH ASWINA, 1939
WP(C).No. 6059 of 2017 (F)
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PETITIONER:
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BAIJU K.K.
AGE 34 YEARS, S/O.KUNJU, KOLANCHERY HOUSE,
MATTOOR, KALADY P.O, ERNAKULAM DISTRICT.
BY ADV. DR.GEORGE ABRAHAM
RESPONDENTS:
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1. KERALA FINANCIAL CORPORATION
REPRESENTED BY ITS GENERAL MANAGER,
HEAD OFFICE: VELLAYAMBALAM,
THIRUVANANTHAPURAM -695 033.
2. DISTRICT COLLECTOR
ERNAKULAM - 682 030.
3. LAND REVENUE COMMISSIONER
THIRUVANANTHAPURAM -695 001.
4. DEPUTY TAHSILDAR (REVENUE RECOVERY)
KERALA FINANCIAL CORPORATION, KALOOR,
ERNAKULAM DISTRICT - 682 019.
5. CHIEF MANAGER
KERALA FINANCIAL CORPORATION,
PERUMBAVOOR BRANCH, SNDP BUILDING,
PERUMBAVOOR -683 541.
6. M.O. CHAKKUNNY, S/O.OUSEPH
MOOLAN HOUSE, KOODALPPAD, KOOVAPPADY P.O,
PERUMBAVOOR -683 541.
7. M.O. ESTHAPPAN, S/O.OUSEPH
MOOLAN HOUSE, KOODALPPAD, KOOVAPPADY P.O,
PERUMBAVOOR -683 541.
8. STATE OF KERALA
REPRESENTED BY SECRETARY TO GOVERNMENT,
REVENUE DEPARTMENT, THIRUVANANTHAPURAM-695033.
R1 & 5 BY ADV. SRI.BASANT BALAJI,SC, KERALA FINANCIAL
CORPORATION
SC, KERALA FINANCIAL CORPORATION
R8 BY GOVERNMENT PLEADER SRI C S ASHARAF
THIS WRIT PETITION (CIVIL) HAVING BEEN FINALLY HEARD ON
06-10-2017, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:
WP(C).No. 6059 of 2017 (F)
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APPENDIX
PETITIONER'S EXHIBITS
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P1 TRUE COPY OF THE PARTNERSHIP DEED EXECUTED BETWEEN THE
RESPONDENTS 6 AND 7.
P2 TRUE COPY OF THE LIST OF PROPERTIES MRTGAGED WIH THE
5TH RESPONDENT
P3 TRUE COPY OF THE LOAN SANCTIONED LETTER
P4 TRUE COPY OF THE JUDGMENT IN WPC 9678/2008
P5 TRUE COPY OF THE JUDGMENT IN WRIT APPEAL NO.1106/2008
P6 TRUE COPY OF THE COMMUNICATION DATED 5.8.2014
P7 TRUE COPY OF THE ENCUMBRANCE CERTIFICATE OBTAINED FROM
THE OFFICE OF THE SUB REGISTRAR OFFICE, PERUMBAVOOR.
P8 TRUE COPY OF THE LETTER ISSUED BY THE PETITIONER DATED
30.4.2016
P9 TRUE COPY OF THE COMMUNICATION DATED 13.5.2016 ISSUED
BY THE 5TH RESPONDENT
P10 TRUE COPY OF THE APPEAL PREFERRED BEFORE THE 3RD
RESPONDENT
P11 A COPY OF THE ORDER ISSUED BY THE LAND REVENUE
COMMISSIONER DATED 7.9.2016
P12 A COPY OF THE REVISION FILED BY THE PETITIONER
P13 A COPY OF THE GOVERNMENT ORDER GO(MS)NO.34/17/RD DATED
27.1.2016
RESPONDENTS' EXHIBITS
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NIL
/TRUE COPY/-
PA TO JUDGE
ANU SIVARAMAN, J.
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W.P.(C).No.6059 of 2017
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Dated this the 6th day of October, 2017
JUDGMENT
1.This writ petition is filed with the following prayers:-
I. To issue a writ of certiorari or any other appropriate writ, order or direction to quash Exhibit P11 and Exhibit P13 orders issued by the 8th and 3rd respondents respectively.
II.To issue a writ of mandamus or any other appropriate writ, order or direction directing respondents 1 to 4 to lift the attachment ordered against the petitioner for the immovable properties which are not mortgaged with the 1st respondent. III.To declare that the respondents 1 to 5 cannot proceed against the other properties which were not included in Exhibit P2 for recovery of amount due from respondents 6 and 7."
2.Heard learned counsel for the petitioner and the learned Government Pleader as well as the learned Standing Counsel for the Kerala Financial Corporation.
3.It is submitted by learned counsel for the petitioner that the property having an extent of 30 cents, which exclusively W.P.(C).No.6059/17 2 belongs to him, has been attached and further steps are being taken in terms of the Kerala Revenue Recovery Act,1968 (hereinafter referred to as 'R.R.Act'). It is submitted that the petitioner is a surety for a loan availed of by a partnership firm, in which respondents 6 and 7 are partners, from the Kerala Financial Corporation ('KFC' for short). It is submitted that one item of the property belonging to the petitioner and his mother had been mortgaged to the KFC. The extent of the property is 1 acre and 44 cents. It is submitted that pursuant to the non- payment of loan amount, the KFC has proceeded against the said properties and also against the properties belonging to the partners, the principal debtors as also the sureties. The petitioner contends that the property covered by Exhibit P7 attachment, not being a mortgaged property is not liable to be proceeded against under the R.R. Act.
4.The 5th respondent, however, stated that the petitioner being a surety, his properties are also liable to be proceeded W.P.(C).No.6059/17 3 against in view of the persistent default by the principal debtor. Exhibit P9 communication dated 13.05.2016 reveals the stand taken by the 5th respondent. Thereafter, the petitioner preferred Exhibit P10 appeal before the Land Revenue Commissioner contending that the action of the respondents in proceeding against his personal property was not necessary, since there are large extent of landed properties under mortgage in respect of the loan and the entire defaulted amount could be realised by sale of those properties itself. By Exhibit P11 order dated 7.9.2016, the appeal was rejected. The petitioner had preferred Exhibit 12 revision before the Government. In the revision, apart from the earlier contentions raised, the petitioner had raised the contention that no notice under Section 7 and Section 34 of the R.R.Act was issued to the petitioner and to his mother. This Court had directed consideration of the revision preferred by the petitioner by judgment dated 21.10.2016 in W.P.(C).No.33435/2016. Pursuant thereto, the petitioner was heard. By Exhibit P13 order dated 27.01.2016, the W.P.(C).No.6059/17 4 revision preferred by the petitioner was also dismissed. Referring to the grounds raised by the petitioner regarding non-service of notice under Section 7 and Section 34 of the R.R.Act, it is stated that the Government had examined the contentions of the revision petitioner and heard the arguments of the parties. It is further stated that the relevant report and records were perused and the Government found that all action taken by the revenue authorities were in accordance with the provisions of the R.R.Act. The petitioner contends that such finding is incorrect and that no notice had been served on the petitioner before the attachment as contemplated under Section 34 of the R.R.Act was effected. Relying on a decision of this Court in John v. District Collector [1989 (2) KLT 831], the learned counsel for the petitioner contends that the issuance of a notice before attachment under Section 34 of the R.R.Act is mandatory and attachment effected without such notice is incompetent.
W.P.(C).No.6059/17 5
5.Counter affidavits have been filed by the 5th respondent as well as the 8th respondent. It is stated in the said counter affidavits that the petitioner had stood as a surety to the loan transaction between the partnership firm and the KFC. It is stated that the contentions raised by the petitioner in the revision filed by him had been considered in detail. It is further stated that notices under Sections 7 and 34 of the R.R.Act had been served to the petitioner's mother Smt.Reeta Kunju on 07.08.2003, who was also co-obligant to the loan. It is stated that the petitioner was well aware of the proceedings taken against him and as per the loan agreement, the petitioner was also liable for repayment of the amounts due. In the counter affidavit filed on behalf of respondents 1 to 5 also, it is the specific case that the petitioner is a surety and is therefore liable to repayment of amounts defaulted under the agreement. A list of properties which have been mortgaged and which have later been attached has also been furnished by respondents 1 to 5 in their counter affidavit.
W.P.(C).No.6059/17 6
6.The main contention urged by the learned counsel for the petitioner is that the Government, while disposing of the statutory revision, had not considered the specific contention urged by the petitioner that no notice had been served on him before Exhibit P7 attachment was effected. The petitioner does not dispute the fact that he is a surety to the loan transaction. His contention is that the entire amount due under the loan with interest and all accruals could be realised by the sale of the mortgaged properties and properties of the firm and there will be no necessity to proceed against the personal properties of the sureties. The petitioner contends that the delay in realising the amounts due under the loan by sale of mortgaged properties is resulting in severe prejudice to the petitioner. It is contended that since the attachment as made in Exhibit P7 was without notice, the petitioner's personal property is not liable to be proceeded against.
W.P.(C).No.6059/17 7
7.I have considered the contentions advanced with respect to the challenge to Exhibit P13. The petitioner had taken up a contention that notice had not been served on him before the attachment was effected. The Government, in Exhibit P13 order as well as in the counter affidavit has taken a specific stand that notice under Section 7 and Section 34 was, as a matter of fact, issued to the petitioner. It is clear that the records and reports had been perused before Exhibit P13 order was passed. In the absence of any allegations of mala fides against the 8th respondent Government or its officers, I am of the opinion that the statement made in Exhibit P13 to the effect that the records have been perused and it was found that procedure was duly followed before the orders of attachment were issued, is liable to be accepted by this Court. Further in the counter affidavit also, it has been stated that the necessary notices had been issued. The petitioner had on 30.04.2016 approached the KFC as well as the Deputy Tahasildar seeking lifting of the attachment of the property owned by the petitioner. Exhibit P8 refers to W.P.(C).No.6059/17 8 an attachment order dated 30.04.2016. The petitioner therefore was well aware of the attachment made on his property. Exhibit P9 does not contain any averment as to any lack of notice before the attachment is effected. In Exhibit P10 appeal as well as Exhibit P12 revision petition, a ground was taken that notice had not been issued before the attachment is effected. This ground has been specifically taken note of by the Government in Exhibit P13. The learned counsel for the petitioner contends that the service of notice on the petitioner's mother would not be sufficient, since the petitioner had not been personally served the notice. I am unable to accept the said contention, since a notice properly issued to the defaulter under Section 34 of the R.R.Act cannot be held to be not served only for the reason that it had not been physically served on him personally. I do not find any material to interfere with the findings of the Government in Exhibit P13 order. However, in view of the contentions raised by the petitioner that large extents of landed property are available as mortgaged W.P.(C).No.6059/17 9 property with the 5th respondent, I am of the opinion that it is only just and proper that the respondents proceed against mortgaged property before proceeding against the personal property of the petitioner.
With the above observation, this writ petition is disposed of.
Sd/-
Anu Sivaraman, Judge sj/10/11