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SRI.CHACKO MATHEW, S/O. MATHEW v. SUNNY JACOB, S/O. CHACKO MATHEW - WA No. 1748 of 2006(E)  RD-KL 1848 (23 January 2007)
IN THE HIGH COURT OF KERALA AT ERNAKULAMWA No. 1748 of 2006(E)
1. SRI.CHACKO MATHEW, S/O. MATHEW,
1. SUNNY JACOB, S/O. CHACKO MATHEW,
2. THE DISTRICT COLLECTOR, KOTTAYAM.
3. THE KERALA STATE INDUSTRIAL DEVELOPMENT
4. THE REVENUE RECOVERY TAHSILDAR,
5. THE VILLAGE OFFICER,
For Petitioner :SRI.DEVAN RAMACHANDRAN
For Respondent :SRI.M.PATHROSE MATTHAI (SR.)
The Hon'ble the Chief Justice MR.V.K.BALI The Hon'ble MR. Justice M.RAMACHANDRAN
O R D E R
(V.K.BALI, C.J & M.RAMACHANDRAN, J)W.A.No. 1748 of 2006-E
Dated this the 23rd day of January, 2007
Ramachandran, J:5th respondent in W.P.(C).No.14000 of 2006 has come up with this appeal being aggrieved by judgment dated 21-06-2006. The first respondent herein was the petitioner in the writ petition. The prayer in the petition was for quashing Ext.P13 proceedings of the Village Officer, Muttambalam dated 15-05-2006 and for directing the Governmental officers (Ist and 4th respondents) to effect mutation of title in respect of the property referred to in Ext.P1 sale deed. It is admitted that he had substantial liability in respect of a loan arrangement made with the Kerala State Industrial Development Corporation (hereinafter referred to as KSIDC).
2. Since the writ petition was filed by practically a stranger, we had to gather necessary details from the averments made in the writ petition, the writ appeal as well [WA No.1748 of 2006] -2- as the documents, which are produced by the parties on both sides.
3. The appellant had encumbered the properties covered by Ext.P9 to a scheduled commercial bank. It appears that at a later point, he had made it as security for advancement of loan from the KSIDC as well. The KSIDC in due course when there was default in repayments, taken resort to revenue recovery proceedings against him, as he was admittedly personally liable for Rs.30.17 lakhs payable against buyback of shares held by KSIDC in the company floated. According to the appellant, he had found a means to settle some of the dues payable and a request was made by him on 28-03-2006 requesting the KSIDC to withdraw the revenue recovery proceedings. He was advised by the General Manager and Secretary of the Corporation, by Ext.P8
letter dated 28-03-2006, inter alia as following:
"We have examined the request in detail and agree to issue a letter to RR authorities to withdraw the RR procreedings subject to payment of Rs.7.50 lakhs in lump sum. RR collection charges, if any, demanded by the RR authorities is to be paid separately by the company. The modalities of settling the balance loan outstanding can be discussed on receipt of Rs.7.50 lakhs, separately". [WA No.1748 of 2006] -3-
4. On the strength of this assurance, according to the appellant, he had remitted Rs.7.50 lakhs, but later on KSIDC has turned round so as to bring imediments for sale proposed. There was a purchaser and he had advanced substantial funds. He submits that such arrangements would have been beneficial to the KSIDC as well. The property was already security for loans advanced by bank and revenue recovery proceedings would have to be subservient to the superior claim. On principles of estoppal, it was unethical on their part to intervene in the sale which was already permitted to be carried out, and he had offered that balance of purchase price would be deposited with KSIDC directly by the purchaser on his account. In the above scenario, the purchaser had come up with the writ petition.
5. The learned single Judge had held that when once Revenue Recovery proceedings are initiated it should have been withdrawn only after reaching the final end and an officer of the Corporation had no rights to advise a debtor that it would be possible to discontinue the recovery proceedings on any specified terms. It was in this context, the learned Judge found that the writ petition was not [WA No.1748 of 2006] -4- sustainable. The plight of the petitioner was not looked into therefore.
6. We had heard Mr.Devan Ramachandran, counsel for the appellant, Mr.Pathrose Mathai, appearing for KSIDC. Counsel for the first respondent herein was also heard. About Rs.25 lakhs remitted by him is locked up in the Bank for no fault of his.
7. According to us, interference is warranted in the interest of all parties concerned. Sri.Pathrose Mathai, with a sense of righteous indignation, submits that there was a fraud played on KSIDC and no amount would have been advanced had they known that there was prior charge on the same property. However, fact remains that it may not be possible for them to proceed against the properties straight away as there is prior charge in respect of a transaction entered with the Bank. What is presently brought about is a private sale and the appellant and first respondent submit that the entire amount will be deposited in the South Indian Bank, Overseas Branch, Ernakulam and he will have no objection in the [WA No.1748 of 2006] -5- KSIDC taking steps for appropriation of the funds, which is surplus.
8. The K.S.I.D.C. has to realise the realities. Dry principles of procedure may not be able to deliver goods, and the writ petition therefore should not have been closed without taking notice of the impact as such. This is because protection of Section 44 of the Act would not have been there at all. Having permitted a private sale, the KSIDC was not justified in retracing the steps and the substantial prayer incorporated in the writ petition was liable to be granted.
9. The judgment in W.P.(C).No.14000 of 2006 dated 21-06-2006 is therefore set aside and there will be a direction to the 2nd, 4th and 5th respondents herein to ensure that appropriate mutations are carried out at the instance of the first respondent herein for transfer of the properties, after due formalities are found as complied with.
10. The first respondent herein is to deposit the entire purchase price with the South Indian Bank and the [WA No.1748 of 2006] -6- KSIDC will be entitled to appropriate the surplus, that may be there. Their other rights to proceed against the appellant are however kept in tact. Sd/- V.K.BALI (CHIEF JUSTICE) Sd/- M.RAMACHANDRAN
(JUDGE)mks/ - True Copy - P.S.to Judge
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