IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT : THE HONOURABLE MR. JUSTICE C.K.ABDUL REHIM THURSDAY, THE 9TH JULY 2009 / 18TH ASHADHA 1931 WP(C).No. 22344 of 2007(I) -------------------------- PETITIONER(S): --------------- M/S AISWARYA INDUSTRIES, EZHUMATTOOR P.O., MALLAPPALLY, PATHANAMTHITTA DISTRICT, REPRESENTED BY ITS MANAGING PARTNER, M.BABURAJ. BY ADV. SRI.A.M.SHAFFIQUE, SENIOR ADVOCATE SRI.E.K.NANDAKUMAR SRI.A.K.JAYASANKAR NAMBIAR SRI.ANIL D. NAIR RESPONDENT(S): --------------- 1. KERALA FINANCIAL CORPORATION, (INCORPORATED UNDER THE STATE FINANCIAL CORPORATIONS ACT, 1951), THIRUVANANTHAPURAM REPRESENTED BY ITS MANAGING DIRECTOR. 2. THE BRANCH MANAGER, KERALA FINANCIAL CORPORATION, PAZHAMANNIL, JESSY TOWERS, COLLEGE ROAD, PATHANAMTHITTA. 3. DEPUTY TAHSILDAR(REVENUE RECOVERY), K.F.C., ALAPPUZHA. *ADDL. R4: THE GOVERNMENT OF KERALA, REP: BY THE SECRETARY, MINISTRY OF FINANCE, SECRETARIAT, THIRUVANANTHAPURAM. (*IMPLEADED AS PER ORDER DT.10.12.0 IN I.A.16083/07 ADV. SRI.K.JAJU BABU,SC,KERALA FINANCIAL COR FOR R1 & 2 GOVERNMENT PLEADER MR.K.SANIL KUMAR THIS WRIT PETITION (CIVIL) HAVING BEEN FINALLY HEARD ON 09/07/2009, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: WP(C).22344/07 APPENDIX PETITIONER'S EXHIBITS:- EXT.P1:- COPY OF DEMAND NOTICE UNDER SECTION 7 DT.6.3.04 ISSUED BY R3 EXT.P2:- COPY OF DEMAND NOTIACE UNDER SECTION 34 DT.6.3.04 ISSUED BY R3 EXT.P3:- COPY OF LETTER DT.17.3.07 ISSUED BY R2 EXT.P4:- COPY OF LETTER DT.3.7.07 ISSUED BY R3 EXT.P5:- COPY OF LETTER DT.2.7.07 ISSUED BY R2 RESPONDENT'S EXHIBITS:- NIL okb //True Copy// P.A. to Judge C.K.ABDUL REHIM, J. ------------------------------ W.P.(C)No.22344 OF 2007 ------------------------------ Dated this the 9th day of July, 2009 J U D G M E N T ---------------------- 1. The challenge in this writ petition is against Ext.P4 notice issued by the 3rd respondent demanding 5% collection charges in respect of a requisition made for recovering arrears due from the petitioner in a loan account. The petitioner had already settled the arrears with the 1st respondent under 'One time settlement scheme' and the entire amount has already been paid. But inspite of such payment, the collection charges insisted upon as per Ext.P4 is highly unjustifiable, illegal and unsustainable, is the contention. 2. This Court in Bhaskaran Vs. Sub Registrar (2005 (3) KLT 150) while dealing with the question regarding default in payment of collection charges in cases where the amount has been paid directly to the requisitioning authority, it is held that Rule 5 of the Revenue Recovery Rules 1968 (Kerala) is applicable only in cases where amount has been recovered through proceedings initiated under Revenue Recovery Act. In another decision of a Division Bench of this Court in W.A.No:2502/07, dt:23.10.07 (unreported) it is held that even the requisitioning authority is not liable to pay collection charges W.P.(C).22344/07 2 under the proviso to Section 71 of the Kerala Revenue Recovery Act 1968, if it had withdrawn the requisition and no amount has been collected through the recovery proceedings. In view of the dictum laid in the above cited decisions it is clear that the demand for collection charges under Ext.P4 is unsustainable. Hence Ext.P4 is hereby quashed. 2. It is submitted by the learned counsel appearing for petitioner that the title deeds pledged for the purpose of securing the loan was got released from the respondents 1 and 2 pursuant to an interim order of this Court, on condition of furnishing bank guarantee for the disputed amount of collection charges. In view of quashing Ext.P4, the respondents are directed to release the bank guarantee furnished by the petitioner forthwith. C.K.ABDUL REHIM, JUDGE. okb