Delhi District Court
Balbir Singh vs Dsfdc on 11 April, 2022
IN THE COURT OF MS. RICHA GUSAIN SOLANKI, ADDITIONAL SENIOR
CIVIL JUDGE CUM JSCC CUM GUARDIAN JUDGE (SOUTH-
WEST)COURTS: DWARKA :NEW DELHI
CNR No. DLSW030003832015
CS SCJ : 425715/2016
Balbir Singh
s/o Sh. Budhram
r/o House No. 1586, Jatav Mohalla,
Najafgarh New Delhi-43 ........Plaintiff
Versus
1 DSFDC
at Ambedkar Bhawan,
Sector-16, Rohini,
New Delhi-89
2. SDM/ Assistant Collector, Najafgarh
at Tuda Mandi, Najafgarh,
New Delhi-43
3. Deputy Commissioner, South-West
Kapashera,
New Delhi. ..........Defendants
Date of institution : 30.06.2015
Arguments heard on : 07.04.2022
Date of decision : 11.04.2022
JUDGMENT
This is a suit for declaration and permanent injunction. The brief facts as stated in the plaint are:−
1. The plaintiff states that defendant no. 1 is a company registered under the Companies Act. It is stated that in June 2015 the plaintiff received a notice dated 09.06.2015 without any annexure from the office of defendant no. 2 whereby the plaintiff was directed to deposit Rs. 6,10,390/-. It is stated that as per the notice, the amount was recoverable in terms of the request letter dated CS No. 425715/2016 Page no. 1/9 Balbir Singh vs DSFDC & Ors.
28.04.2015 issued by defendant no. 1. It is stated that on 17.06.2015 the plaintiff appeared before defendant no. 2 and requested annexures to the said notice. It is stated that the plaintiff requested a short adjournment for obtaining relevant documents and the matter was fixed for a hearing on 02.07.2015. It is stated that when the plaintiff applied for certified copies, he came to know that there were only two documents in the proceedings file i.e. the notice and the request letter for issuance of the recovery certificate. It is stated that the plaintiff had obtained a loan from defendant no. 1 in the year 1999 for purchasing a tempo traveller. It is stated that the plaintiff paid the instalments for some period but later diesel commercial vehicles were banned in Delhi and hence, the plaintiff could not pay the remaining instalments to defendant no. 1. It is stated that defendant no. 1 filed two cases against the plaintiff in Delhi Courts but the same were dismissed. It is stated that the letter dated 28.04.2015 is not a recovery certificate under the Revenue Recovery Act. It is stated that defendant no. 3 forwarded the letter to defendant no. 2 without going through the document. It is stated that defendant no. 1 had no power to issue a recovery certificate and wants to recover a time-barred debt from the plaintiff. Hence the present suit has been filed seeking a declaration that the letter dated 28.04.2015 is not a recovery certificate and seeking an injunction restraining the defendants from initiating any recovery proceedings against the plaintiff on the basis of the said letter.
2. Defendant no. 1 filed a written statement stating that the plaintiff has been a regular defaulter in payment of loan instalments. It is stated that a suit & a complaint case were filed u/s 138 NI Act and they were dismissed not on merits but on technical grounds. It is stated that defendant no. 1, being a corporation/government undertaking, can recover its dues as arrears of land revenue through the SDM and the limitation period for the same is 33 years.
3. The plaintiff filed a replication denying the contents of the written statement of defendant no. 1 and reiterated the averments made in the plaint.
CS No. 425715/2016 Page no. 2/9 Balbir Singh vs DSFDC & Ors.
4. Defendant no. 2 and 3 filed a written statement stating that statutory notice under Section 80 CPC had not been served on defendant no. 2 and 3 before the filing of the suit. It is stated that defendant no. 2 and 3 are quasi-judicial authorities and they cannot be impleaded as parties in a suit for acts done in discharge of their quasi-judicial duties. It is stated that the GNCTD, through its Secretary, should have been impleaded as a party. It is stated that the plaintiff had appeared before the Assitant Collector on 18.06.2014 and stated that there was no outstanding amount of loan. It is stated that at that time the plaintiff did not take the plea that the no recovery certificate had been issued by a competent authority.
5. The plaintiff filed a replication denying the contents of the written statement of defendant no. 2 and 3 and reiterated the averments made in the plaint.
6. Vide order dated 06.04.2017 the following issues were framed:
"(i) Whether the plaintiff is entitled for the relief of declaration as prayed for? OPP
(ii) Whether the plaintiff is entitled for permanent injunction, as prayed for ?
(OPP)
(iii) Relief."
7. In order to prove his case, the plaintiff entered the witness box as PW1 on 11.07.2017 and tendered his affidavit Ex PW-1/A in evidence. He relied on a certified copy of the notice dated 09.06.2015 as Ex. PW-1/1 and a certified copy of the letter dated 28.04.2015 as Ex. PW-1/2.
8. The evidence of defendant no.1 was not completed and due to repeated defaults on its part, its examination-in-chief was stricken from the record.
9. Defendant no.2 and 3 did not lead any evidence.
10.Heard and record perused.
11.Issue wise findings are as under:-
11.1. "(i) Whether the plaintiff is entitled for the relief of declaration as prayed for? OPP"
CS No. 425715/2016 Page no. 3/9
Balbir Singh vs DSFDC & Ors.
11.1.1 The onus of proving this issue was on the plaintiff.
It is the admitted case of parties that the plaintiff had taken a loan from defendant no.1 for purchasing a tempo traveller and the loan was not returned.
The two questions that require adjudication from this Court are: whether defendant no.1 could have issued a letter dated 28.04.2015, and whether any recovery certificate has been issued in the manner prescribed. 11.1.2. In respect of the first question, the plaintiff has deposed that defendant no. 1 had no power to issue a recovery certificate. On the other hand, defendant no.1 has contended that it is a corporation/government undertaking and thus it can recover its dues as arrears of land revenue through the SDM.
Ld Counsel for the plaintiff has argued that a company registered under the Companies Act cannot be a 'local authority' and it cannot recover its dues under the Revenue Recovery Act 1890. Ld Counsel has placed reliance on judgment in the case of Dat Pethe vs. Dist Collector, Erna kulam AIR 1976 Kerala 37 in this regard.
11.1.3. Section 5 of the Revenue Recovery Act 1890 provides that where a sum is recoverable by any public officer other than a Collector or by any local authority, a recovery certificate may be issued. Therefore, it was incumbent on defendant no.1 to show that it is a 'local authority.' However, defendant no.1 has not explained how it claims to be one.
11.1.4. Ld Counsel for defendant no.1 has placed reliance on the judgment in the case of Delhi Financial Corporation v Harish Chander Gulati 2002 (62) DRJ 705 to submit that it can resort to Section 32G of the State Finance Corporation Act as well as Section 31/29 of the State Finance Corporation Act to recover its dues.
I am unable to agree with this submission. The petitioner in the said case was the Delhi Financial Corporation which has been established under the State Finance Corporation Act 1951. However, defendant no.1 has not been established under the Act 1951. It cannot avail of the advantages provided CS No. 425715/2016 Page no. 4/9 Balbir Singh vs DSFDC & Ors.
under the Act of 1951. Its own Memorandum of Association (filed with the written statement) states that defendant no.1 is a private limited company registered under the Companies Act 1956. None of the clauses of its Memorandum of Association and Articles of Association mentions that it is incorporated under the State Finance Corporation Act. 11.1.5. Even if it is assumed that defendant no.1 is indeed a 'local authority' under Article 12 of the Constitution of India, even then the issuance of the letter dated 28.04.2015 cannot be treated as a recovery letter or certificate. The Articles of Association of defendant no.1 provides that a certificate can be issued only by the Executive Director. However, a perusal of the letter dated 28.04.2015 shows that it has been issued by the Deputy Manager. This letter does not even mention that the letter is being issued on behalf of or with the permission of the Executive Director. Hence, it is apparent that the recovery letter/certificate dated 28.04.2015 could not have been issued by defendant no.1.
11.1.6. Coming to the second question, whether any valid recovery certificate has been issued in this case, I am unable to answer this in favour of the defendants.
The letter was issued by the officer of defendant no.1 at Rohini, that is, revenue District North. The letter was sent to defendant no.3, who has jurisdiction over District South-West. Upon this letter Ex PW1/2, defendant no.2 issued a Notice Ex PW1/1.
Section 5 of the Revenue Recovery Act provides that where any sum is recoverable as an arrear of land revenue by any local authority, the Collector of the district in which the authority is situated shall, on the request of the officer of authority, may send a certificate of the amount to be recovered to the Collector of another district, as if the sum were payable to himself. Therefore, even if defendant no.1 was a 'local authority', it's Executive Director ought to have applied to the Deputy Commissioner, North for issuing and forwarding CS No. 425715/2016 Page no. 5/9 Balbir Singh vs DSFDC & Ors.
the recovery certificate to Deputy Commissioner, South-West. Defendant no.1 could not have applied directly to defendant no.3 and defendant no.2 could not have acceded to the request made by defendant no.1.
11.1.7. One also wonders which document is being assailed as a 'recovery certificate' by the defendants.
Ex PW1/2 is titled as "Sub: Issue of Recovery Certificate...."; in other words, this letter from defendant no.1 only requests for issuance of a recovery certificate. This letter does not mention anywhere that it is itself a recovery certificate. Indeed under Section 3 and 5 of the Revenue Recovery Act and Section 32G of the State Finance Corporation Act, only the Collector/State Government is empowered to issue a recovery certificate. Ex PW1/2 is therefore not a recovery certificate.
Ex PW1/1 is titled as "Notice" and it mentions that a recovery certificate had been issued against the plaintiff and hence defendant no.2 has been asked to recover the amount. Clearly this document is also not a recovery certificate.
The plaintiff has stated on oath that when he applied for certified copies of the proceedings file, he came to know that there were only two documents in the proceedings file i.e. the notice and the request letter for issuance of recovery certificate. Then the question is: Where is the recovery certificate issued by defendant no.3? The defendants have left this question unanswered. 11.1.8. Ld Counsel for defendant no. 2 and 3 has also argued that the suit is bad for want of statutory notice under Section 80 CPC.
It is correct that the admittedly no notice under Section 80 CPC has been served upon defendant no.2 and 3 before filing the present suit. However, when issues were framed on 06.04.2017, no issue was framed on the maintainability of the suit for want of notice. The defendants neither pressed for framing of an issue over this nor did they move any application for dismissal of the suit on this ground. It has been almost seven years since the present suit was instituted and all this while defendant no.2 and 3 have contested the suit on merits. At CS No. 425715/2016 Page no. 6/9 Balbir Singh vs DSFDC & Ors.
this stage, it would be a travesty of justice to take such a pedantic approach and dismiss the suit of the plaintiff on a technical ground. Reliance is placed on the judgment in the case of Yashod Kumari And Anr. vs MCD And Ors., 111 (2004) DLT 33 11 wherein it was held that:
"11. Apart from this, we find that the appellant's suit was already registered by the Court first and ex parte interim order was also passed in this. It was thereafter transferred to District Court along with the application for grant of leave. From this it could also be easily presumed that the Court had impliedly granted the leave to institute the suit or that the notice stood waived in the facts and circumstances of the case. This aspect seems to have gone totally unnoticed with Trial Court proceedings mechanically; in the matter to dismiss the suit for want of notice under Section 80, CPC. ....
14. ....After all the purpose of notice under Section 53-B of DDA Act is the same as that of Section 80, CPC i.e. to bring the claim to the authority's notice so that it may concede or contest it. Once the authority had contested it on merits even at preliminary stage, it could not complain of non-service of notice under Section 53-B now. Nor could it be held fatal to justify the dismissal of the suit.
15. Viewed this, we allow this appeal and set aside the impugned dismissal order. Technically this would revive appellant's suit for consideration of appellant's application for grant or refusal of leave but we feel that much water had flowed down since and doing so would be an exercise in futility because parties have already contested the suit on merit all through and all these years. It would be ridiculous and hyper- technical to take them back to square one for a fresh debate on service of two months' notice under Section 80, CPC or Section 53-B of DDA Act"
(emphasis supplied) 11.1.9. Likewise in the present case too, the suit was registered and an ex parte stay order was granted in favour of the plaintiff on the very first day of hearing. Later the interim application was also allowed in favour of the plaintiff on 10.11.2016. These facts imply that the Court had either waived the service of notice or that the notice stood waived by defendant no. 2 and 3. 11.1.10. Ld Counsel for defendant no. 2 and 3 has argued that defendant no. 2 and 3 are quasi-judicial authorities and they cannot be impleaded in a suit for acts done in discharge of their quasi-judicial duties.
CS No. 425715/2016 Page no. 7/9 Balbir Singh vs DSFDC & Ors.
However, this argument is out of place. In the present case, defendant no. 2 has merely issued a Notice without conducting any proceedings and without recording any satisfaction about the amount due. The functions of a Collector under Section 5 of the Revenue Recovery Act are ministerial and not quasi-judicial. Reliance is placed on the judgment in the case of Callipers Naigai Ltd. And Ors. vs Government Of NCT Of Delhi And Ors., 110 (2004) DLT 41, wherein it was held that:
"Upon a reading of the aforesaid provisions, it becomes clear that under Section 3 of the RR Act, where an arrear of land revenue or a sum recoverable as an arrear of land revenue is payable to a Collector by a defaulter being or having property in a district other than that in which the arrear accrued or the sum is payable, the Collector may send to the Collector of that other district a certificate in the form as nearly as may be of the Schedule stating the name of the defaulter and such other particulars as may be necessary for his identification or the amount payable by him or the account on which it is due. Section 3(2) stipulates that the certificate shall be signed by the Collector making it, and save as otherwise provided by this Act, shall be conclusive proof of the matters therein stated. Sub Section (3) of Section 3 mandates that the Collector of the other district shall, on receiving the certificate, proceed to recover the amount stated therein as if it were an arrear of land revenue which had accrued in his own district. Two things are clear. Firstly, the certificate issued by the Collector in the District where the arrears accrued shall be conclusive proof of the matter stated therein and secondly, the Collector of the other district is duty-bound to give effect to this certificate and proceed to recover the amount stated therein. From this, it becomes apparent that the Collector who receives such a recovery certificate has no role to play except to recover the amount stated in the recovery certificate as arrears of land revenue. He merely performs a ministerial function. He does not decide any lis and any action taken by him does not have the trappings of a quasi-judicial function."
(emphasis supplied) CS No. 425715/2016 Page no. 8/9 Balbir Singh vs DSFDC & Ors.
11.1.11. Resultantly, the letter Ex PW1/2 as well as the notice Ex PW1/1 have not been issued in the manner prescribed by law. They cannot be sustained in law and none of them can be identified as a 'recovery certificate' under the Revenue Recovery Act.
11.1.12. Therefore, issue no. 1 is decided in favour of the plaintiff and against the defendants. It is declared that neither the letter no. F.No. 19(21/120)97-98/T.T. DSFDC/2347 dated 28.04.2015 nor the notice No. F.8/SDM/NG/Rec./107/2015/1777 dated 09.06.2015 is a valid recovery certificate.
11.2 "(ii) Whether the plaintiff is entitled for permanent injunction, as prayed for ? (OPP)"
The onus of proving this issue was on the plaintiff. In view of the findings on issue no. 1, the plaintiff is granted an injunction and the defendants are restrained from initiating any recovery proceedings against the plaintiff on the basis of the letter no. F.No. 19(21/120)97-98/T.T. DSFDC/2347 dated 28.04.2015 or the notice No. F.8/SDM/NG/Rec./107/2015/1777 dated 09.06.2015. Accordingly, issue no.2 is also decided in favour of the plaintiff and against the defendants.
11.3 "(iii) Relief"
In view of the above-noted findings, the suit of the plaintiff is decreed. Parties to bear their own cost. Decree sheet be prepared accordingly.
File be consigned to record room.
RICHA Digitally signed by
RICHA GUSAIN
GUSAIN SOLANKI
Date: 2022.04.11
SOLANKI 17:11:39 +0530
Announced in the open Court today (Richa Gusain Solanki)
on 11th April 2022 JSCC/ASCJ/GJ:S-W:
Dwarka Courts: New Delhi
CS No. 425715/2016 Page no. 9/9
Balbir Singh vs DSFDC & Ors.