IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT : THE HONOURABLE MR. JUSTICE C.K.ABDUL REHIM TUESDAY, THE 5TH OCTOBER 2010 / 13TH ASWINA 1932 WP(C).No. 6168 of 2010(U) --------------------------------------- PETITIONER(S): ------------------------- UMMER MUHAMMED, MAMMAPRAYILLATH HOUSE,MANNUTHY PO, TRICHUR. BY ADV. SRI.SHEJI P.ABRAHAM RESPONDENT(S): --------------------------- 1. SECRETARY, TRICHUR CORPORATION, TRICHUR. 2. DEPUTY THAHASILDAR (RR), TRICHUR. R1 BY ADVS. SRI.K.B.MOHANDAS,SC,THRISSUR CORPORATION, SRI.LELLULAL T.G.THUNDATHIL. R2 BY GOVERNMENT PLEADER SRI. BIJOY CHANDRAN THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 05/10/2010 ALONG WITH WPC NO. 6228 OF 2010 AND CONNECTED CASES, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: Kss C. K. ABDUL REHIM, J. =~=~=~=~=~=~=~=~=~=~=~=~=~=~=~=~= W.P.(C) Nos. 6168, 6228, 6379 and 6397 of 2010 =~=~=~=~=~=~=~=~=~=~=~=~=~=~=~=~= Dated this the 5th day of October, 2010 JUDGMENT Petitioners in all these writ petitions are successful bidders with respect to licence for occupation of rooms in a Shopping Complex owned by the 1st respondent Corporation. The petitioners, being the highest bidders, were issued with notices to make payment of security deposit equivalent to six months licence fee and also to make payment of one month's licence fee in advance. Accordingly, they have remitted the security deposit as well as advance licence fee as demanded. Necessary agreements were also executed in the prescribed proforma, as per Ext.P1. 2. According to the petitioners, in spite of execution of the agreements, required infrastructure facilities and amenities were not provided for actual occupation and W.P.(C) No. 6168/2010 & con. cases 2 conduct of business in the rooms in question. Various representations were submitted by the petitioners requesting the 1st respondent to provide such facilities and amenities, at the earliest. It is stated that without providing such amenities, Ext.P3 in W.P.(C) No.6168 of 2010 and similar other notices were issued. Through such notices the 1st respondent informed that, the petitioners failed in accepting the keys and failed in taking possession of the respective rooms. Therefore, the petitioners were requested to take possession of the rooms in question within 24 hours, otherwise it was informed that the security deposit and advance licence fee will be forfeited, and the rooms will be re-auctioned at the risk and cost of the petitioners. It is stated that even after issuing such notices, the 1st respondent had not taken any action for a long time. But revenue recovery steps were initiated at present for recovery of arrears of licence fee due for the period from 2007 to 2010. The said recovery steps are under challenge in these writ petitions. W.P.(C) No. 6168/2010 & con. cases 3 3. It is contended that the revenue recovery steps were initiated without conducting any adjudication regarding the liability and hence the same is unsustainable. It is further contended that the amounts in question is not recoverable under the revenue recovery proceedings. 4. In the counter affidavit of the 1st respondent it is contended that, pursuant to notices issued, the petitioners have received the keys on 5-11-2007. According to the 1st respondent, the petitioners have occupied the rooms with effect from 5-11-2007 onwards. It is denied by the 1st respondent that the petitioners have raised any dispute regarding the facilities provided or made any complaint with respect to lack of any amenities. It is contended that in spite of occupation of the rooms, the petitioners failed to make payment of the licence fee from November, 2007 onwards. Therefore notices were issued to the petitioners, requesting them to remit the arrears along with interest, within three days. Such notices were acknowledged by the petitioners. Even thereafter the arrears were not paid and W.P.(C) No. 6168/2010 & con. cases 4 therefore the 1st respondent had repossessed the rooms in question, on 28-3-2009. It is contended that the revenue recovery steps initiated are perfectly legal and justifiable, since the petitioners had defaulted payment of licence fee due for the period from 11/2007 to 3/2009. 5. Learned counsel for the petitioners pointed out that clause 5 in Ext.P1 agreement stipulates that if there is any default in payment of the licence fee, the Secretary of the Corporation can repossess the room in question by evicting the occupiers. In clause 7 it is further stated that in spite of such repossession, the rooms can be given back to the licensee, if he remits arrears within 7 days. But if such remittance is not made, the licence is liable to be cancelled by the Secretary. It is further pointed out that, in clause 8 it is specifically mentioned that, on such cancellation all the articles in the premises can be sold in public auction and the receipt thereof can be appropriated against the arrears. It is further stated that if the sale proceeds is not sufficient to wipe off the arrears of licence fee and other charges, the W.P.(C) No. 6168/2010 & con. cases 5 balance amount can be recovered and it is as arrears of land revenue. Contention of the petitioners is that the Secretary has never repossessed the rooms nor had taken any steps for cancellation of licence. Without resorting to such procedures contemplated under clauses 5 and, steps for recovery now initiated, demanding licence fee for a long period, are not sustainable, is the contention. 6. Apart from the dispute raised relating to liability for payment of the arrears of licence fee, learned counsel for the petitioners raises a larger question with respect to maintainability of the recovery steps under the provisions of the Revenue Recovery Act. According to the petitioners, the liability, which was sought to be recovered, is not at all adjudicated and quantified in any manner acceptable under law. It is contended that as the petitioners are disputing the liability, a proper adjudication is warranted before proceeding with recovery steps. Per contra, learned counsel for the 1st respondent contended that, the amount sought to be recovered being arrears of licence fee, which the W.P.(C) No. 6168/2010 & con. cases 6 petitioners obliged under the terms of the agreement, no such adjudication is necessary. 7. In this regard the petitioners placed reliance on decisions reported in Mohammed Kunhi V. Executive Engineer (2001(3) KLT 733), Rambal Co. V. Kerala State Science & Technology Museum (2002(2) KLT SN 73 Case No.77) etc. The dictum laid down in those cases emphasize the need for having adjudication with respect to disputed liabilities, before initiating steps for recovery. In the case at hand, the liability is in dispute, since the petitioners denied continued occupation of the rooms. Further the petitioners are disputing the liability on the basis that there was failure on the part of the 1st respondent in cancelling the agreement and demanding the amount at any prior point of time within two years. 8. Learned counsel for the petitioners raise yet another legal contention that the amount which is sought to be recovered being alleged loss caused to the 1st respondent by virtue of an agreement, and the amount being one arising W.P.(C) No. 6168/2010 & con. cases 7 out of an alleged breech of an agreement, it cannot be treated as an arrear of tax, surcharge or cess. On the contrary, the 1st respondent specifically points out the provisions contained in clause 8 of the agreement, which enables such recovery. 9. Having considered the rival submission, I am of the opinion that there exists a genuine dispute between the parties with respect to the liability which is now sought to be recovered under the revenue recovery proceedings. Going by dictum laid down in the decisions cited above, I am of the opinion that the recovery steps can be pursued only after conducting an adjudication of the liability and only after quantifying the amount, if any due. Under such circumstances, I am of the opinion that the matter need be remitted back for a decision of the 1st respondent. 10. In the result, the writ petitions are disposed of quashing the revenue recovery steps initiated against the petitioners. The 1st respondent will be at liberty to issue notice to the petitioners and to conduct a proper W.P.(C) No. 6168/2010 & con. cases 8 adjudication, after affording a reasonable opportunity to the petitioners. A decision on the basis of such adjudication need be intimated to the respective petitioners. It will be left open to the petitioners to raise all the disputes including the dispute against maintainability of the revenue recovery steps. Needless to say that further steps of recovery can be pursued only subject to the final decision taken on the basis of the above said directions. C. K. ABDUL REHIM, JUDGE. mn.