Full Judgment
IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT: THE HONOURABLE MR.JUSTICE K.M.JOSEPH & THE HONOURABLE MR. JUSTICE A.HARIPRASAD TUESDAY, THE22D DAY OF OCTOBER201330TH ASWINA, 1935 WA.No. 1542 of 2013 () IN WP(C).7046/2013 ------------------------------------------- (AGAINST THE ORDER
/JUDGMENT
IN WP(C) 7046/2013 of HIGH COURT OF KERALA DATED0304-2013) APPELLANT(S)/PETITIONER: ----------------------- K.V.SANATHANAN, AGED40YEARS S/O. LATE K.V.NARAYANAN NAIR, PUNCHAVAYAL KAYAKUNNU P.O., PANAMARAM, WAYANAD DISTRICT. BY ADV. SRI.V.N.RAMESAN NAMBISAN RESPONDENT(S)/RESPONDENTS: ---------------------------- 1. THE TAHSILDAR, MANANTHAWADI, WAYANAD DISTRICT, PIN-671121.
2. THE DEPUTY TAHSILDAR (REVENUE RECOVERY) TALUK OFFICE, MANANTHAWADI, WAYANAD DISTRICT PIN-671121.
3. THE MANAGER, DISTRICT INDUSTRIES CENTRE, MUTTIL, KALPETTA, WAYANAD DISTRICT, PIN-671123.
4. THE BRANCH MANAGER CANARA BANK, PANAMARAM BRANCH, WAYANAD PIN-671123. R1 TO R3 BY GOVERNMENT PLEADER SRI. SYAM KUMAR R4 BY SRI.PAULY MATHEW MURICKEN,SC,CANARA BAN THIS WRIT APPEAL HAVING COME UP FOR ADMISSION ON2210- 2013, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: K.M.JOSEPH & A.HARIPRASAD, JJ.
-------------------------------------- W.A. No.1542 of 2013 -------------------------------------- Dated this the 22nd day of October, 2013. JUDGMENT
K.M.Joseph, J.
The appellant is the writ petitioner. The appellant approached this Court with the following prayers; "i). to issue a writ of certiorari or any other appropriate writ, order or direction quashing Exhibit P3 and Exhibit P4; ii). to declare that the petitioner has availed collateral free loan from the Canara Bank, Panamaram Branch under the Exhibit P1 CGFSI Scheme, and as evident from exhibit P2, guarantee fee and annual service fee was also realized by the Money Lending Institution ( MLI) from the petitioner and therefore, legally at the instance of the 3rd respondent, respondents 1 and 2 cannot initiate revenue recovery proceedings against the petitioner. iii). to declare that for the commencement and continuance of the business by the petitioner under the name and style of M/s San Spices and Curry Powder, Panamaram, Wayanad, no amount was disbursed by the 3rd respondent directly to the petitioner and in the recovery proceedings initiated by Canara Bank, Panamaram in O.A. 68/12 before the Debt Recovery Tribunal, Ernakulam against the petitioner, the amounts of Exhibits P3 and P4 are also included and therefore, respondents cannot initiate and continue the revenue recovery proceedings in Exhibits P3 and P4; iv). to issue a writ of mandamus or any other appropriate writ, order or direction commanding the 3rd respondent to make available the entire records relating to the starting of the firm viz. M/s San Spices and Curry Powder, Panamaram, Wayanad W.A. No.1542/2013 2 before this Hon'ble Court so as to ascertain if there is any financial commitment involved between the petitioner and the 3rd respondent;" 2. Briefly put, the case of the appellant before the Learned Single Judge was as follows; "Petitioner has started a small industry, M/s. San Spices and Curry Powder at Panamaram, Wayanad in the year 2007. For that he has availed collateral free loan from the Canara Bank, Panamaram Branch, under Exhibit P1 CGFSI Scheme, a scheme introduced and funded by the Central Government join with the SIDBI. Limit of loan under the above scheme is Rs. 1 crore. Petitioner has availed Rs.24 Lakhs (Rs.13 Lakhs terms loan plus Rs. 11 Lakhs OD facility). As evident from Exhibit P2, guaranteed fee and annual service fee was also collected by the Money Lending Institution ( MLI) here Canara Bank. Therefore, fund provided by the MLJ is guaranteed/insured by the Trust under the Exhibit P1 scheme. Therefore, on default MLI can invoke guarantee and claim from the Trust under the above scheme upto 75%. Balance 25% through recovery proceedings, for which Canara Bank has already initiated recovery in O.A. 68 of 2012 before the DRT, Ernakulam. Admittedly no amount was disbursed by the 3rd respondent directly to the petitioner. But, now as per Exhibit P3 and P4, 3rd respondent had initiated Revenue Recovery proceedings, which is totally illegal, arbitrary and violative of Exhibit P1 scheme and principles of natural justice. Hence, challenging Exhibits P3 and P4 revenue recovery proceedings Writ Petition is filed".
3. The Learned Single Judge found that there is absolutely no materials to accept the case of the appellant that the margin money loan disbursed by the 3rd respondent was part of the loan disbursed by the Bank and that the same also gets coverage of Ext.P1 scheme. It is further noted that the submissions of the W.A. No.1542/2013 3 learned Government Pleader and in particular the agreement dated 24/10/.2005 produced by him prove to the contra. It is also noted that the complete set of papers, containing the details of Ext.P1 scheme produced by the Government Pleader, shows that it contains a list of Banks which are covered by the scheme and that the scheme does not cover the 4th respondent. The Learned Single Judge held that if that be so, the irresistible conclusion that is possible is that the revenue recovery proceedings initiated at the instance of the 3rd respondent cannot be held to be illegal and accordingly the writ petition was dismissed.
4. We heard the learned counsel for the appellant, learned Government Pleader for respondent 1 to 3 and the learned counsel for the 4th respondent bank.
5. Perusal of Annexure -I produced along with the application (I.A. No.824.2013) would show that it was on the basis of the application dated 14/10/2005 filed by the appellant before the DIC, Wayanad, the DIC sanctioned Margin Money Loan of Rs. 1,50,000/- against the term loan and another Rs.1,00,000/- against the working capital loan. Thus, a total sum of Rs. 2,50,000/- was sanctioned. The learned counsel for the appellant sought to rely on 'clause No. 1' in Annexure-1 order. Clause No. 1 of Annexure 1 reads as follows; "1. The Margin Money Loan against term loan shall be repaid by the applicant W.A. No.1542/2013 4 unit in 16 equal instalment starting from the 91st day after the date on which the last instalment of term loan falls due as scheduled by the financing institution/bank originally or on completion of the 51st month from the date of disbursement of the Margin Money Loan whichever is earlier." Besides reference is made to the following paragraph; "The Manager(Credit), District Industries Centre is authorised to draw the sanctioned amount and to credit it to the account of the applicant in the Canara Bank, Panamaram Branch after the agreement has been produced, duly executed".
6. There is no dispute that as against the application for Rs.3,40,000/-, Rs.2,50,000/- was sanctioned and it was disbursed to the appellant through the Canara Bank. In this regard the learned counsel for the 4th respondent Bank would submit that the Bank's case is that the amount is directly disbursed to the party and not through the Bank. Whatever that be, we find from Annexure 1 that it is Margin Money Loan which has to be repaid by the appellant in 16 equal monthly instalments as provided in clause '1' of Annexure 1. Therefore, it was meant to be a loan and it was provided as Margin Money Loan as against the loans which were advanced by the 4th respondent Bank.
7. According to the learned Government Pleader, actually there was default committed in repayment of the loan amount. This resulted in recovery proceedings being taken. In this regard, the W.A. No.1542/2013 5 learned Government Pleader drew our attention to clause '8' of Annexure 1 order, which reads as follows; "8. In the case of default by the unit of the dues under the Margin Money Loan the entire amount outstanding shall be liable to be recovered as if it be arrears of land revenue under the provisions of the Kerala Revenue Recovery Act 1968 from the assets of the unit and its promoters and in such other manner that the Government may deem fit. " 8. If that be so, the recovery proceedings initiated for recovery of defaulted margin money loan apparently in terms of Annxure 1 cannot be faulted or interfered with by this Court. The learned counsel for the appellant was asked as to whether there is reference to margin money loan in Annexure 1. The learned counsel for the appellant was not able to make any reference to margin money loan in Annexure 1. As already noted amount given as margin money loan is to be repaid. It is to be repaid either through the bank or through the DIC, Wayanad. It is quite clear to us, on going through the case of the learned Government Pleader who would submit that the amount was routed through the bank and the case of the bank that it was routed directly through the appellant, that the appellant received amount and he has received amount in terms of Annexure 1. Annexure 1 permits recovery through the Revenue Recovery Act. If that be so, proceedings taken for recovery of the defaulted margin money loan, as W.A. No.1542/2013 6 evidenced by the impugned proceedings cannot be interfered with. We find no merit in the appeal. Accordingly, the appeal will stand dismissed. However, we make it clear that this will be without prejudice to the appellant's right to take all the contentions available in law in proceedings between the appellant and the respondent bank. K.M.JOSEPH, JUDGE. A. HARIPRASAD, JUDGE. dpk