IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT : THE HONOURABLE MR. JUSTICE C.K.ABDUL REHIM THURSDAY, THE 3RD FEBRUARY 2011 / 14TH MAGHA 1932 WP(C).No. 3165 of 2011(U) --------------------------------------- PETITIONER(S): ------------------------- SANTHA VISWANATHAN, W/O.V.K.VISWANATHAN NAMBIAR, PARVATHY NILAYAM, MUCHUKUNNU P.O., KOZHIKODE DISTRICT. BY ADV. SRI.R.PARTHASARATHY RESPONDENT(S): --------------------------- 1. STATE OF KERALA REPRESENTED BY ITS SECRETARY, DEPARTMENT OF REVENUE, THIRUVANANTHAPURAM - 1. 2. THE DISTRICT COLLECTOR, KOZHIKODE - 2. 3. THE MANAGING DIRECTOR, KERALA FINANCIAL CORPORATION, THIRUVANANTHAPURAM - 1. 4. KERALA FINANCIAL CORPORATION, REPRESENTED BY ITS CHIEF MANAGER,KOZHIKODE - 11. 5. THE DEPUTY TAHSILDAR (RR), KERALA FINANCIAL CORPORATION,KOZHIKODE - 11. R1,R2 & R5 BY GOVERNMENT PLEADER SRI. BIJOY CHANDRAN R3 & R4 BY ADV. SRI. R.S. KALKURA, SC, KFC THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 03/02/2011, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: Kss C.K.ABDUL REHIM, J. ------------------------------------------- W.P.(C).No.3165 of 2011 ------------------------------------------- Dated this the 3rd day of February, 2011 J U D G M E N T ---------------------- Petitioner availed a loan from respondents 3 and 4 for purchase of two Buses. Consequent to loss sustained in the service conducted, the Buses were sold, and according to the petitioner, the proceeds thereof was remitted to the loan account. On an approach made by the petitioner, the respondents 3 and 4 permitted 'One Time Settlement' and the petitioner was directed to make payment of a total sum of Rs.11 lakhs. According to the petitioner, eventhough the said amount was remitted, the respondents made a further demand for a sum of Rs.98,000/- which was challenged before this court through a writ petition. In Ext.P2 judgment this court observed that the further demand pertains to interest due on belated payments, for which the petitioner is liable, and that this court cannot direct release of the documents without payment of the said amount. 2. Liberty was granted to the petitioner to pay off the said amount and to seek release of the documents. It is stated that subsequently the petitioner had effected payment of the said amount of Rs.98,000/- as evidenced from Ext.P1 receipt. W.P.(C).3165/11 -2- But still the respondents had refused to close the account and to release the title deeds pertaining to the mortgage created, insisting upon the petitioner to produce 'No Objection Certificate' from the 5th respondent and also requesting to make payment of legal expenses to the tune of Rs.5,450/- in connection with Ext.P2 writ petition. The demand raised as above is challenged in this writ petition. 3. Contention of the petitioner is that the insistence now made by the 5th respondent for payment of collection charges is unsustainable in view of the fact that the petitioner had settled payment directly to respondents 3 and 4. The petitioner is also disputing liability for payment of the legal charges demanded, contending that in Ext.P2 judgment this court has not ordered cost. 4. Considering the question regarding liability for payment of collection charges I take notice of a decision rendered by a Division Bench of this court in Malabar Organics Ltd. Vs. State of Kerala (2009 (4) KLT 328) and Usha Mary Vs. K.F.C. (2009 (4) KHC 254) wherein it is held that collection charges is not leviable with respect to amounts due to the 3rd respondent Corporation, if payment is made directly and in cases where amounts were not recovered through coercive proceedings under the Kerala Revenue Recovery Act. W.P.(C).3165/11 -3- 5. Learned Government Pleader appearing for respondents 1, 2 and 5 submits that the question regarding liability for payment of collection charges is now pending consideration before the Hon'ble Supreme Court in a Special Leave Petition filed by the State Government against the above said decisions and that an interim stay was granted by the Hon'ble Supreme Court. 6. However, I am of the view that as the legal position stands settled through the decisions cited above, there is no justification in withholding release of the documents since the petitioner had effected payment of the amounts directly to respondents 3 and 4. Regarding the dispute for payment of the legal expenses, counsel appearing for respondents 3 and 4 contends that, as per the terms of the loan agreement the petitioner is liable for payment of any expenses incurred in connection with legal proceedings and therefore they are liable. I am of the view that this court is not in a position to hold that the petitioner is no way liable for payment of legal expenses. 7. Under the above circumstances the writ petition is disposed of directing respondents 3 and 4 to release the mortgage and to return the title deeds and other documents and after collecting legal charges as demanded under Ext.P4, provided no other dues except the collection charges is liable to W.P.(C).3165/11 -4- be paid. It is made clear that the liability for payment of collection charges will ultimately depend on the outcome of the decision of the Hon'ble Supreme Court. 8. Needless to say that on release of the mortgage all necessary steps consequent thereof shall be taken by respondents 3 and 4. If payment of amounts due is effected, the needful steps for release of the mortgage shall be done without any further delay. C.K.ABDUL REHIM, JUDGE. okb