IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT : THE HONOURABLE MR. JUSTICE C.N.RAMACHANDRAN NAIR & THE HONOURABLE MR. JUSTICE V.K.MOHANAN THURSDAY, THE 21ST AUGUST 2008 / 30TH SRAVANA 1930 OP.No. 20174 of 2001(B) ----------------------- PETITIONER(S): --------------- 1. B.RAMACHANDRAN NAIR, ONATTU HOUSE, ONAKKOOR.P.O., MUVATTUPUZHA. 2. GOPALACHANDRAN NAIR, ONATTU HOUSE, ONAKKOOR.P.O., MUVATTUPUZHA. 3. SOMASUNDARAN NAIR, ONATTU HOUSE, ONAKKOOR.P.O., MUVATTUPUZHA. 4. SMT.VILASINI AMMA, ONATTU HOUSE, ONAKKOOR.P.O., MUVATTUPUZHA. 5. SUKUMARAN NAIR, ONATTU HOUSE, ONAKKOOR.P.O., MUVATTUPUZHA. 6. SAROJINI AMMA, ONATTU HOUSE, ONAKKOOR.P.O., MUVATTUPUZHA. BY ADV. SRI.DEEPU THANKAN SMT.DEEPA DEEPU THANKAN OP NO.20174/2001 RESPONDENT(S): --------------- 1. STATE OF KERALA, REPRESENTED BY ITS SECRETARY (TAXES), THIRUVANANTHAPURAM. 2. EXCISE COMMISSIONER, THIRUVANANTHAPURAM. 3. ASSISTANT EXCISE COMMISSIONER, KOTTAYAM. 4. DISTRICT COLLECTOR, ERNAKULAM. 5. TAHSILDAR (R.R.), MUVATTUPUZHA. *ADDL.R6. K.K.KOSHI, KAITHAYIL HOUSE, MANNANAM, KOTTAYAM. **ADDL.R7. DISTRICT COLLECTOR, KOTTAYAM. (* IMPLEADED AS ADDITIONAL 6TH RESPONDENT IN THE ORIGINAL PETITION AS PER ORDER DATED 26/07/2005 IN I.A. NO.10988/2005.) (** IMPLEADED AS ADDITIONAL 7TH RESPONDENT AS PER ORDER DATED 22/12/2005 IN I.A.NO.12670/2005) SMT.SMITHA, GOVERNMENT PLEADER FOR R1 TO R6 SMT.C.S.SHEEJA FOR ADDL.R6 THIS ORIGINAL PETITION HAVING BEEN FINALLY HEARD ON 21/08/2008, ALONG WITH WPC NO. 29483 OF 2006, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: OP NO.20174/2001 ORDER ON CMP NOS.32774/2001, 40523/2001 IN CMP NO.32774/2001, 50303/2001, 10352/2003 IN CMP NO.50303/2001 IN CMP NO.32774/2001, I.A.NOS. 2102/2003, 13847/2003 & 12670/2005 IN O.P.NO.20174/2001 DISMISSED. SD/- (C.N.RAMACHANDRAN NAIR, JUDGE) 21/08/2008 SD/- (V.K.MOHANAN, JUDGE) APPENDIX PETITIONER'S EXHIBITS P1 : COPY OF THE LETTER OF THE FIRST RESPONDENT TO THIRD RESPONDENT DATED 09/11/1991. P2 : COPY OF THE PETITION DATED 31/03/90 SUBMITTED BY THE 1ST PETITIONER TO THIRD RESPONDENT. P3 : COPY OF THE RECEIPT DATED 08/10/91. P4 : COPY OF THE LETTER OF THE THIRD RESPONDENT TO FIRST RESPONDENT DATED 10/12/91. P5 : COPY OF CHELAN DATED 30/11/91. P6 : COPY OF LETTER DATED 25/04/90 ISSUED BY THE THIRD RESPONDENT TO FIRST RESPONDENT. P7 : COPY OF NTOICE ISSUED BY THE 5TH RESPONDENT DATED 02/12/91. P8 : COPY OF THE NOTICE ISSUED by the 5TH RESPONDENT DATED 02/12/91. P9 : COPY OF THE RECEIPT DATED 30/11/95. P10 : COPY OF THE JUDGMENT IN O.P.159/92 DATED 12/02/98. P11 : COPY OF THE LETTER DATED 06/08/99 ISSUED BY THE 5TH RESPONDENT TO THE PETITIONER. P12 : COPY OF the REPRESENTATION SUBMITTED BY THE PETITIONER TO THE SECOND RESPONDENT. P13 : COPY OF the ORDER PASSED BY THE SECOND RESPONDENT DATED 22/02/2000. P14 : COPY OF THE NOTICE ISSUED BY THE FIFTH RESPONDENT DATED NIL. P15 : COPY OF THE NOTICE ISSUED by the FIFTH RESPONDENT DATED NIL. P16 : COPY OF THE LETTER OF THE PETITIONER TO SECOND RESPONDENT DATED 20/11/2000. O.P. NO.20174/2001 P17 : COPY OF THE ORDER DATED 06/08/2005. P17(a) : COPY OF the CERTIFICATE ISSUED BY THE THRID RESPONDENT DATED 30/07/2001. P18 : COPY OF THE LETTER OF THE THIRD RESPONDENT TO FIFTH RESPONDENT DATED 11/09/2001. P18(a) : COPY OF THE WRITTEN STATEMENT FILED BY THE DISTRICT COLLECTOR IN O.S.21/2000 BEFORE SUB COURT, KOTTAYAM. P19 : COPY OF THE REVENUE RECOVERY NOTICE ISSUED BY THE FIFTH RESPONDENT. RESPONDENT'S EXHIBITS R3(a) : COPY OF THE D.C.B.STATEMENT. R6(a) : COPY OF THE JUDGMENT OF THE SUB COURT, KOTTAYAM IN O.S.21/2000 DATED 29/07/2003. R7(a) : COPY OF the REQUISITION DATED 14/11/2000 RECEIVED FROM THE DEPARTMENT OF EXCISE. //TRUE COPY// PA TO JUDGE. jg C.R. C.N.RAMACHANDRAN NAIR & V.K.MOHANAN, JJ. ------------------------- O.P.No.20174 of 2001 & WP(C) No.29483 of 2006 --------------------------------- Dated, this the 21st day of August, 2008 J U D G M E N T Ramachandran Nair, J. These writ petitions are filed challenging revenue recovery proceedings for recovery of arrears of abkari dues due from petitioners and two other licencees, namely Mr.Mammen Koshy and Mrs.Mary Sophy Koshy, who are the brother and mother respectively of petitioner in WP(C) No.29483/06. These two licencees namely Mammen Koshy and Mary Sophy Koshy are dead and it is not known whether there is any proceedings pending against the legal heirs of these two persons. Since the facts are almost identical, we do not intend to consider the details of licence issued and the exact amount due from each and every licencee. The total abkari dues from all the licencees including the petitioners as on 31/03/1990 was Rs.1,18,34,068/-, which is for the years 1987-88 to 1989-90. RR proceedings started soon after the default and Government notified 42 acres of properties of the defaulters for O.P.No.20174 of 2001 & WP(C) No.29483 of 2006 -2- sale in revenue auction in 1990 itself. However, since there was no bidders for the same, entire properties were purchased by the Government for the nominal value of Re.1/-. Immediately after purchase of the property by the Government and taking over possession from the defaulters, 15 acres of land was given free of cost to Navodaya Vidyalaya Samithy at Kottayam on 24/07/1990 and three years thereafter, another 9.84 acres of land was also given to them, free of cost. As such, 24.84 acres of land was given free of cost to Navodaya Vidyalaya School as it is run by the Government of India. The balance land taken over from the petitioners was retained by the Government for few years and thereafter Government started distributing and selling the land to various Governmental Agencies, free of cost and also for consideration, the beneficiaries being Indian Institute of Mass Communication, Water Resources Development and Management, etc. On 25/04/1995, the Government gave 4.20 acres of land free of cost to the Indian Institute of Mass Communication. Out of the remaining land, one acre was given for a consideration of Rs.5,06,196/- to the Water Resources Development and Management for construction of a Sub Centre for them at O.P.No.20174 of 2001 & WP(C) No.29483 of 2006 -3- Kottayam. The balance land of 11.55 acres was given to the Rubber Board, another Central Government Agency, on 28/05/1997 for a consideration of Rs.75,30,866/-. It is conceded that from out of the land taken over, another one acre is left with the Government, which they propose to allot to the Consumer Forum for construction of Court and for other purposes. Learned Government Pleader submitted that proposals are already finalised for assignment of this land to various Governmental agencies including Consumer Forum. Even after credit of Rs.75,30,866/- already recovered by the Government to the loan arrear account of the defaulters, there will be substantial arrears due from the defaulters. According to the learned Government Pleader, Government is entitled to recover entire arrears and the entitlement of the defaulters is only to get full credit of the recovered amount. 2. Learned counsel for the petitioners contended that there is amnesty scheme introduced by the Government under which petitioners are willing to settle the entire liabilities with applicable rate of interest and they should be restored the land. On the other hand, learned Government Pleader submitted that since the defaulters did not challenge taking over of the land years back, O.P.No.20174 of 2001 & WP(C) No.29483 of 2006 -4- Government is free to appropriate the land for it's own purposes and accordingly, the Government has distributed the land among various agencies and the said land cannot be restored. We are in agreement with the contention of the learned Government Pleader that petitioners have no right to challenge the purchase of the land by Government in RR proceedings at this distance of time, after Government has appropriated the land for various purposes, which are all public purposes. However, we find force in the contention of the petitioners that further recovery proceedings against them should not be allowed to be continued for more than one reason. In the first place, it is admitted that on sale of 12 acres of land to Governmental agencies at moderate price fetched the Government above Rs.75 lakhs, which accounts for almost 70% of the liabilities as on 31/03/1990. In fairness, the Government should have fixed reasonable value for the balance land assigned to various agencies and if the fair price was given credit in the arrear amount of the defaulters, then they would have got refund of massive amounts. It is admitted that all the properties are situated in and around Kottayam town and the value of 42 acres of land as of now would be crores of rupees. Probably the value of balance one acre of land O.P.No.20174 of 2001 & WP(C) No.29483 of 2006 -5- taken over and still left with the Government will be sufficient to take care of the entire debt. However, it is impossible to restore the land to petitioners because out of 42 acres taken over by Government, 41 acres have already been assigned to various Governmental agencies mostly free of cost and balance for consideration, which has to be credited in the arrear account of the petitioners. Since assignment of 12 acres of land fetched the Government above Rs.75 lakhs in 1997, we have to necessarily assume that the fair market value as on that date for the balance 30 acres of land would have been multiples of liabilities due from petitioners and therefore it will be thoroughly inequitable to permit further recovery from petitioners, after allowing the Government to enjoy the properties taken over from the petitioners free of cost. In fact, in many cases, lands acquired by the Government years back and retained as bought in land were restored to defaulters on clearing the arrears, either by Government itself or though Court orders. In this case, it so happened that out of three major defaulters, two of them are dead and the other is around 90 years of age. In short, defaulters were either dead or did not have the capacity to resist the recovery steps taken against them. Moreover, O.P.No.20174 of 2001 & WP(C) No.29483 of 2006 -6- we feel Government is the only beneficiary for the lapses on the part of the defaulters because their failure to contest resulted in property worth crores of rupees vesting in Government for Government's liberal appropriation for use by school and other Governmental agencies. Timely challenge of recovery proceedings would have led to restoration of land to defaulters and considering the value of the properties, defaulters would have gained substantially even after settling arrears with full interest. However, death of two defaulters and advanced age of the surviving one prevented them from taking any timely steps for settlement and restoration of property. In view of the substantial recovery and appropriation of defaulters land by Government, the value of which in our estimation is multiples of the balance arrears, we partly allow the writ petitions by quashing the further revenue recovery proceedings pending against the defaulters, guarantors and also against legal heirs of the deceased licencees, namely Mr.Mammen Koshy, whose 15 acres of land was taken over by the Government as bought in land and Mrs.Mary Sophy Koshy, whose 9.84 acres of land was acquired by the Government. 3. Incidentally, we feel that the RR Act requires O.P.No.20174 of 2001 & WP(C) No.29483 of 2006 -7- amendment to deal with bought in land in RR proceedings, so that defaulters do not suffer at least after forfeiture of their entire land in recovery proceedings. We direct the Government to consider amendment to the statute for disposal of bought in land and for settlement of defaulter's liability or for use of the land for Government purposes only after crediting fair market value in the loan account of the parties. (C.N.RAMACHANDRAN NAIR, JUDGE) (V.K.MOHANAN, JUDGE) jg