Kerala High Court
M/S. Ernad Constructions Company Pvt. ... vs State Of Kerala on 27 January, 2020
Equivalent citations: AIRONLINE 2020 KER 13
Author: Shaji P. Chaly
Bench: S.Manikumar, Shaji P.Chaly
IN THE HIGH COURT OF KERALA AT ERNAKULAM
PRESENT
THE HONOURABLE THE CHIEF JUSTICE MR.S.MANIKUMAR
&
THE HONOURABLE MR. JUSTICE SHAJI P.CHALY
MONDAY, THE 27TH DAY OF JANUARY 2020 / 7TH MAGHA, 1941
WA.No.2243 OF 2019
AGAINST THE JUDGMENT IN WP(C) 16813/2018(B) OF HIGH COURT OF KERALA
APPELLANT/PETITIONER:
M/S. ERNAD CONSTRUCTIONS COMPANY PVT. LTD.
A COMPANY REGISTERED UNDER THE COMPANIES ACT, 1956,
REPRESENTED BY ITS MANAGING DIRECTOR, M.K. ALI, AGED 70
YEARS, S/O. MOHAMMED HAJI, 6/138, MANNILTHODI HOUSE,
KEEZHUPARAMBA P.O, AREACODE WEST, MALAPPURAM -673 639
BY ADVS.
SRI.ZAKEER HUSSAIN
SMT.K.A.SANJEETHA
RESPONDENTS/RESPONDENTS:
1 STATE OF KERALA,
REPRESENTED BY THE SECRETARY TO GOVERNMENT, REVENUE
DEPARTMENT, SECRETARIATE, THIRUVANANTHAPURAM-690 001.
2 KERALA FINANCIAL CORPORATION,
MANUELSONS BUILDING, G.H. ROAD, KOZHIKODE-673 001,
REPRESENTED BY ITS CHIEF MANAGER.
3 DEPUTY TAHSILDAR,
REVENUE RECOVERY, KERALA FINANCIAL CORPORATION,
KOZHIKODE-673 001
4 KERALA STATE RURAL ROADS DEVELOPMENT AGENCY,
LOCAL SELF GOVERNMENT (RD) DEPARTMENT, 3RD FLOOR, CSI
BUILDING, PULIMOODU JUNCTION,
THIRUVANANTHAPURAM-690 001, REPRESENTED BY ITS CHIEF
ENGINEER.
W.A. No. 2243 OF 2019
-2-
5 M/S. KITCO LIMITED,
FEMITHS, P.B. NO. 4407, PUTHIYA ROAD, VENNALA, KOCHI-682 028,
REPRESENTED BY ITS MANAGING DIRECTOR.
R1 & R3 BY SRI. TEK CHAND, SR. GOVERNMENT PLEADER(B/O)
R2 BY SRI.M.R.VENUGOPAL, SC, KFC
R4 BY ADV. STANDING COUNSEL(B/O)
R5 BY ADV. SRI.M.GOPIKRISHNAN NAMBIAR
R5 BY ADV. SRI.K.JOHN MATHAI
R5 BY ADV. SRI.JOSON MANAVALAN
R5 BY ADV. SRI.KURYAN THOMAS
R5 BY ADV. SRI.PAULOSE C. ABRAHAM
THIS WRIT APPEAL HAVING COME UP FOR ADMISSION ON 27.01.2020, THE
COURT ON THE SAME DAY DELIVERED THE FOLLOWING:
W.A. No. 2243 OF 2019
-3-
JUDGMENT
Dated this the 27th day of January, 2020. SHAJI P. CHALY, J This appeal is filed by the writ petitioner challenging the judgment dated 12.02.2019 in W.P.(C) No. 16813 of 2018 being aggrieved by the dismissal of the writ petition filed against the recovery action initiated against the appellant by the Kerala Financial Corporation, a company incorporated under the Companies Act, 1956 and fully owned by the Government of Kerala, to recover the amounts advanced to the appellant towards loan by invoking Sections 7, 34 and 36 of the Kerala Revenue Recovery Act, 1968 ('the Act' for short).
2. As per the demand raised, the appellant company, the Directors and other guarantors were proceeded with, since personal guarantees were offered by the Directors and others.
3. The learned single Judge, after considering the contentions put forth by the respective parties, has found W.A. No. 2243 OF 2019 -4- that the appellant has not made out any case of arbitrariness, illegality or unfairness on the part of the respondents in initiating action under the provisions of Act, 1968.
4. The paramount contention advanced by the appellant in this appeal is that there is no amount due from the appellant to the respondent Corporation, since power of attorney was given by the appellant authorising the respondent Corporation to receive the amounts due to the appellant from two establishments namely, Kerala State Rural Roads Development Agency and M/s. KITCO Limited. It is also submitted that the entire amounts due from the appellant was received by the Corporation on account of the adjustments made on receipt of the amounts from the aforesaid two establishments. That apart, it is submitted that the appellant has paid more than Rs.6,00,00,000/- to the respondent Corporation, whereas the loan availed by the appellant in three transaction was only 7.85 crores and therefore, the demand raised as per the revenue recovery notices to recover the amount of Rs.7,91,38,481/- cannot be sustained. That apart, it is contended that as per the judgment of the learned single Judge, the appellant was directed to produce proof before the Corporation to get any W.A. No. 2243 OF 2019 -5- adjustments as is claimed by the appellant, which is not possible, since the entire bills raised against the two establishments are with the respondent Corporation.
5. On the other hand, the learned Standing Counsel appearing for the Kerala Financial Corporation submitted that the Corporation had addressed the aforesaid two establishments for receiving the amounts from them as is authorised by the appellant. However, those two establishments have informed the respondent Corporation that there is no amount due from the said establishments to the appellant. Further, it is submitted that the works undertaken by the appellant of the aforesaid two establishments were abandoned by the appellant, and therefore, the contention put forth by the appellant that the work was completed and the amounts were due from those two establishments is not factually correct. That apart, it is submitted that if the appellant had completed the work of those two establishments, definitely completion certificates would have been issued by the said establishments and in the absence of the same, it is evident that no amounts are due from the said establishments to the appellant.
6. We have heard learned counsel appearing for the appellant, Smt. Sanjeetha K.A., Sri. M.R. Venugopal, W.A. No. 2243 OF 2019 -6- learned Standing Counsel for the Kerala Financial Corporation, and the learned senior Government Pleader Sri. Tek Chand, and have perused the pleadings and the documents on record.
7. Admittedly, the appellant has received notices from the revenue recovery authorities on the basis of the request made by the Kerala Financial Corporation under Section 69 of the Act, 1968. Apart from a demand notice issued under Section 7 for attachment and sale of movable property, the appellant was also served with notice of demand under Section 34 and notice of attachment under Section 36 of the Act, 1968.
8. Section 34 deals with demand notice prior to the attachment of land and sub-Section (1) thereto stipulates that before the Collector or the authorised officer proceeds to attach the immovable property of the defaulter, he shall cause a written demand to be served upon the defaulter specifying the name of the defaulter, the amount of the arrear of public revenue due on land for which the attachment is being made, the date on which such arrear fell due, the interest on the arrear and the amount of the batta due to the persons who serve the demand and such other particulars as may be prescribed, and the time W.A. No. 2243 OF 2019 -7- allowed for the payment which shall not be less than seven days from the date of service of the demand.
9. Sub-section (2) specifies that if within the time prescribed under sub-section (1), the defaulter objects to the claim of arrears wholly or in part, the Collector or the authorised officer, as the case may be shall inquire into the objection and record a decision before proceeding to attach the immovable property of the defaulter.
10. Therefore the provisions discussed above clearly show that liberty was available to the appellant on receipt of the demand notice under Section 34 of the Act, 1968 to object to the demands raised before the authority under the Act; but the appellant has not taken any steps to file an objection and to contest the proceedings in accordance with law.
11. Section 35 of Act, 1968, which deals with procedure when defaulter neglects to pay, stipulates that when the amount due has not been paid pursuant to the terms of the written demand, and no arrangement for securing the same has been entered into the satisfaction of the Collector or the authorised officer, as the case may be, he shall proceed to recover the arrear by attachment and sale of the immovable property of the defaulter in the W.A. No. 2243 OF 2019 -8- manner provided in the Act.
12. Section 36 deals with the mode of attachment, as per which the attachment shall be effected by affixing a notice thereof to some conspicuous part of the immovable property to be attached and by serving a copy on the defaulter. The notice of attachment shall also be published and the notice shall specify the name of the defaulter, the amount of arrear of public revenue due on land, the interest thereon, the date on which such arrear became due and such other particulars as may be prescribed, and shall set forth that unless the arrear with interest thereon and the cost of process be paid within the date therein mentioned, the immovable property concerned will be brought to sale in due course of law.
13. Therefore, it is categoric and clear that the appellant had ample opportunity to raise the dispute with respect to the amounts due, and since the appellant failed to do so, he is not entitled to rake up all those issues in a proceedings under Article 226 of the Constitution of India. That apart, the Kerala Revenue Recovery Act, 1968 is a self contained statute by which the proceedings initiated under the Act can be challenged before statutory authorities prescribed thereunder, especially when the issues raised by W.A. No. 2243 OF 2019 -9- the appellant are surrounded by facts not decipherable on the basis of the pleadings and documents produced. The appellant has not taken any steps in that regard also. Moreover, the discussions made above would make it clear that the contentions raised by the appellant are disputed by the respondent Corporation and the revenue recovery authorities making the situations more complex and complicated. Therefore, the learned single Judge was right in holding that the appellant has not made out any case of arbitrariness or illegality justifying interference under Article 226 of the Constitution of India, and therefore, we are of the view that the appellant has not made out any case justifying interference in an intra court appeal filed under Section 5 of the Kerala High Court Act, there being no legal infirmity. But, since the appellant has a case that the bills and other documents required for establishing the adjustments claimed by the appellant consequent to the power of attorney provided to the respondent Corporation regarding the amounts due from the two establishments specified above, are in the custody of the respondent Corporation, we are of the opinion that if any application is filed by the appellant before the respondent Corporation for the issuance of any such documents and if any such W.A. No. 2243 OF 2019 -10- documents are available with the respondent Corporation, the Corporation may take steps to issue copies of the same to the appellant.
Resultantly, writ appeal fails and accordingly, it is dismissed, with the above observation.
sd/-
S. MANIKUMAR, CHIEF JUSTICE.
sd/-
SHAJI P. CHALY, JUDGE.
Rv