IN THE HIGH COURT OF JUDICATURE, ANDHRA PRADESH AT HYDERABAD (Special Original Jurisdiction) MONDAY, THE FIFTEENTH DAY OF JUNE TWO THOUSAND AND NINE PRESENT THE HON'BLE MR JUSTICE R.SUBHASH REDDY WRIT PETITION NO : 15504 of 2003 Between: G.Ram Mohan Rao, S/o.Venkataratnam, Sidharthanagar, Vijayawada. ..... PETITIONER AND 1 A.P.State Financial Corporation, Rep.by its Managing Director, Abids, Hyderabad. 2 Senior Branch Manager, APSFC, Pioneer House, Labbipet, Vijayawada -520 010. .....RESPONDENT(S) Petition under Article 226 of the constitution of India praying that in the circumstances stated in the Affidavit filed herein the High Court will be pleased to to issue a writ, order or orders more particularly one in the nature of writ of mandamus declaring the action of the respondents in initiating the proceedings under A.P.Revenue Act for realization of the outstanding amounts of M/s.Agro Boards Private Limited, Nandamuru, as illegal, null, void, without jurisdiction and issue consequential declaration that the impugned notice dated 26-6-2003 and 8-7-2003 bearing No.AFC/VJA/MR & R/PKR/2003-4/1618 as illegal and null and void and set aside the same. Counsel for the Petitioner:MR.M.S.PRASAD Counsel for the Respondent No.: MR.M.VIDYASAGAR The Court made the following : THE HON'BLE SRI JUSTICE R.SUBHASH REDDY WRIT PETITION NO: 15504 of 2003 ORAL ORDER: In this writ petition the petitioner seeks a declaration by way of mandamus that the action of the respondents in initiating proceedings under A.P. Revenue Recovery Act for realization of outstanding amounts of M/s Agor Boards Private Limited, Nandamuru as without jurisdiction and to declare notices dated 26.6.2003 and 8.7.2003 as illegal and arbitrary. The Andhra Pradesh State Financial Corporation (ASPFC) has extended financial assistance to a company by name M/s A.P. Agro Boards Private Limited. The amounts were sanctioned on different dates. Rs.19.30 lakhs was sanctioned on 20.12.1993, Rs.32.80 lakhs was sanctioned on 31.3.1997 and Rs.13.85 lakhs was sanctioned on 20.12.1993. The assets of the company were secured on pari passu basis in favour of APSFC and A.P. Industrial Development Corporation (APIDC) by way of joint equitable mortgage by deposit of title deeds and hypothecation of machinery. The petitioner who is one of the promotor- directors of the company stood as guarantor in his individual capacity for the liability of the company by executing guarantee agreements in favour of respondent as ell as APIDC. As much as M/s A.P. Agro Boards Private Limited committed default in paying the loan amounts, the respondents seized the assets of the company by issuing recall-cum-sale notice dated 5.8.1999. The plant and machinery of the company was sold under Section 29 of the A.P.S.F.C. Act for Rs.34.65 lakhs and the sale proceeds were distributed on pari passu basis between the respondent – corporation and the APIDC. The land and buildings were also sold for an amount of Rs.16.00 lakhs and the said amounts were also distributed pari passu among the respondent and the APIDC. After adjusting the total sale consideration, as further amounts were due, notices dated 26.6.2003 and 8.7.2003 were issued to the Directors of the company including the petitioner demanding 58.21 lakhs as on 1.5.2003. In this writ petition mainly a declaration is sought that the proceedings initiated under the provisions of the A.P. Revenue Recovery Act are barred by limitation and as such no steps can be taken against the petitioner for recovery of the balance amount due from the company namely M/s A.P. Agro Boards Private Limited. It is also the case of the petitioner that as much as the petitioner discontinued as Director, he is not liable to pay the amount. He has also disputed his signatures on the documents executed in favour of the respondents. Heard Sri M.S.Prasad, learned counsel for the petitioner and Sri M.Vidya Sagar, learned standing counsel appearing for the respondent – corporation. It is argued by the learned counsel for the petitioner that in view of the factual disputes, the petitioner has confined his argument only to one ground namely the proceedings initiated under the A.P. Revenue Recovery Act are barred by limitation and as such no steps can be taken. I have perused the copies of the notices dated 26.6.2003 and 8.7.2003. Notice dated 26.6.2003 was issued by the Senior Branch Manager, APSFC of Vjayawada Branch demanding an amount of Rs.58.21 lakhs which was the outstanding amount as on 1.5.2003. The said notice was not issued under the provisions of the A.P. Revenue Recovery Act. Another notice dated 8.7.2003 was also a similar notice issued by the Senior Branch Manager demanding outstanding balance amount of Rs.74.56 lakhs due as on 30.6.2003 along with interest observing that if he petitioner fails to pay the amount, proceedings would be initiated under the provisions of the A.P. Revenue Recovery Act. The said notice was also not issued under the provisions of the A.P. Revenue Recovery Act. Under Section 32-G of the A.P.S.F.C. Act, 1951 where any amount is due to the financial corporation in respect of any accommodation granted by it to any industrial concern, the financial corporation or any person authorized by it in writing in this behalf, may, without prejudice to any other mode of recovery, make an application to the State Government for the recovery of the amount due to it, and if the State Government or such authority, as that Government may specify in this behalf, is satisfied, after following such procedure as may be prescribed, that any amount is so due, it may issue a certificate for that amount to the Collector, and the Collector shall proceed to recover that amount in the same manner as an arrear of land revenue. In the case on hand, there is no material placed before this Court by the petitioner to show that either any such application was made under Section 32-G or was any such certificate having been issued by the State Government certifying the amount due from the petitioner for taking steps under the provisions of the A.P. Revenue Recovery Act. It is contended by the learned counsel for the petitioner that such a rider is added in the notices dated 26.6.2003 and 8.7.2003 to the effect that failure to the pay the amounts, would result in initiation of proceedings under the A.P. Revenue Recovery Act. It is also further submitted that even the counter affidavit proceeded on premise that proceedings would be initiated under the provisions of the A.P. Revenue Recovery Act. It is also submitted that in view of the judgment of the Supreme Court in State of Kerala v. Kalliyani Kutty[1], no steps can be taken initiated as such, as the limitation period is over. Though reference as to the A.P. Revenue Recovery Act was made in the notices and in the counter affidavit filed by the respondent, nothing is placed on record to show that either the respondent – corporation had made any application to the Government for certification of any amount under Section 32G of the A.P.S.F.C. Act or any such certificate having been issued by the Government for recovery of the amount under the provisions of the Revenue Recovery Act. During the course of arguments also, it is submitted by the learned standing counsel for the respondent – corporation, that no steps are taken so far for initiation of the proceedings under the provisions of the A.P. Revenue Recovery Act. Therefore, the judgment referred to above is not applicable to the facts of the case. In the absence of any material place before this Court to show that any action is contemplated for initiation of proceedings under the A.P. Revenue Recovery Act, it is not open to the petitioner to question the proceedings of the respondent – corporation as having barred by limitation. The alleged initiation of the proceedings by the respondent – corporation under the provisions of the A.P. Revenue Recovery Act is nothing but premature espousing of cause by the petitioner. This writ petition is filed merely on an apprehension that the proceedings are initiated under the provisions of the A.P. Revenue Recovery Act. Mere reference to A.P. Revenue Recovery Act in the notices dated 26.6.2003 and 8.7.2003 cannot be taken as the basis that the respondents are proceeding under the provisions of the Act, in the absence of any statutory notice issued as contemplated under provisions the Act. For the aforesaid reasons, the writ petition is devoid of merits and is, accordingly, dismissed. However, it is made clear that if any notice under the provisions of the A.P. Revenue Recovery Act is issued, it is open to the petitioner pursue the remedies available to him under law. No order as to costs. _____________ 15-6-2009 asp [1] AIR 1999 SC 1305