IN THE HIGH COURT OF JUDICATURE, ANDHRA PRADESH AT HYDERABAD MONDAY, THE TWENTY EIGHTH DAY OF APRIL TWO THOUSAND AND EIGHT PRESENT THE HON'BLE MRS JUSTICE T.MEENA KUMARI AND THE HON'BLE MR JUSTICE S. ASHOK KUMAR WRIT APPEAL NO : 190 of 2008 (Writ Appeal under Clause 15 of the Letters Patent against the Order dated 24/12/2007 in WP No. 27657 OF 2005 on the file of the High Court.) Between: 1 M/s Kumar Chemicals and Fertilisers (P) Ltd. Rep. by its Managing Director, Sri Vinay Kumar Bandari S/o.P.L.Bhandari Hyderabad 2 Vinaya Kumar Bandari R/o. Arun Enclave, Tirumalgiri, Secunderabad, Rep by Agarwaland Vimal Kumar Agarwal, S/o.Biharilal Agarwal, R/o.of H.No.9-1-181, Langer House, Hyderabad. ..... APPELLANTS AND 1 The Andhra Pradesh Industrial Development Corporation Ltd., Rep by its Managing Director, Parishrama Bhavan, Basheerbagh, Hyderabad. 2 The Andhra Pradesh Industrial Development Corporation Ltd., Rep by its Deputy General Manager (Revenue Recovery and AMC) Parisharama Bhavan, Basheerbagh, Hyderabad. .....RESPONDENTS Counsel for the Appellants: MR.B.CHANDRASEN REDDY Counsel for the Respondents.: MR. S.SRI RAM REDDY The Court made the following: ORAL JUDGMENT: (per THE HON’BLE MRS. JUSTICE T.MEENA KUMARI) Aggrieved by the order, dated 24.12.2007 made in WP No. 27657 of 2005 by a learned Single Judge of this court, dismissing the writ petition, the present Writ Appeal is filed. The writ petition was filed seeking to set aside the notice dated 26.9.2005 issued by the 2nd respondent herein invoking provision of Sec.29 of the State Financial Corporation Act, 1951, for recovery of Rs.35,79,228/- from the appellants. The respondent No.1 extended equity of Rs.2.75 lakhs and invested share capital of Rs.75,000/- in the petitioner No.1 Company during 1967-1969 and also sanctioned term loan of Rs.3.50 lakhs. As per the terms, the respondents are entitled to charge interest at 9.5% and in default at 12% p.a. Since the amounts were not paid, in the year 1992, during negotiations, the scheme of One Time Settlement was extended and accordingly an amount of Rs.6,16,867.60 PS was arrived at to be paid by the appellants and accordingly, towards 50% of the said sum, an amount of Rs.3,08,433.80 Ps was paid on 10.11.1992 and since the remaining 50% of the OTS amount was not paid, the Corporation wrote to the District Collector, Hyderabad, on 23.1.2001 to initiate action for recovery of Rs.15,63,005.80 Ps, due, as on 31.12.2001. Later, after discussion with the Tahsildar of the Corporation, the petitioner No.2 addressed letter dated 5.8.204 enclosing a demand draft of Rs.3,09,000/- representing the balance half of the due, agreed under the OTS Scheme, which was encashed by the Corporation. Later, the Deputy General Manager of the Corporation wrote letter dated 26.9.2005 to the Managing Director of the petitioner No.1 to the effect that an amount of Rs.35,79,228/- is due as on 31.5.2005 towards loan instalments and interest and informed of the sale of the factory and if the sale does not materilise or the sale proceeds are insufficient, they will proceed for recovery of the outstanding amount under the provisions of 1951 Act. While so, on 21.11.2005, a letter was addressed on behalf of the petitioners, to the Corporation that in terms of the discussion that took place on 19.11.2005, they are ready to pay an amount of Rs.16.00 lakhs, in full and final settlement, within six months, with certain conditions to return the shares held by the Corporation along with share transfer form. This was not accepted by the Corporation and it decided to seize and sell the assets of the petitioner No.1 company. The case of the petitioner No.2 is that the Corporation having kept quiet for more than 33 years inasmuch as no payment was made by the petitioners, is not entitled to invoke the provisions of A.P. Revenue Recovery Act. It is contended that the payments made under One Time Settlement scheme during 1992 to 2005 is nothing but in full and final settlement. It is also pleaded that the said payments do not extend time for realization of their amount, since by the date of the above payments, it was not a debt. It is also their plea that since the loan was obtained in the year 1967 and the Corporation was brought within the purview of 1951 Act only in the year 1986, Section 29 of the 1951 Act cannot be invoked. The learned Single Judge, on exhaustive consideration of the matter has held that provisions of 1963 Act do not bar the respondents from invoking provisions of Section 29 of 1951 Act to recover a time barred loan and the ratio laid down in State of Kerala and others V. V.R. Kalliyanikutty and another (1999(3) SCC 657) is not applicable to the case of the petitioners and, as such, no part of the loan muchless the whole amount due from the petitioners, is barred by limitation. Aggrieved thereby, the present Writ Appeal is filed by the writ petitioners inter alia contending that in view of the admission of the respondent that they released the loan in the year 1969 and did not receive any payments till 1992, the same is barred by limitation in the year 1981. It is their further case that in terms of Article 62 of the Limitation Act, for enforcement of payment of money obtained by mortgage or otherwise charged upon an immovable property, the limitation is 12 years, therefore, after a long delay of 23 years 7 months, the alleged debt cannot be enforced. As can be seen from the record and the impugned judgment, there was series of correspondence between the parties. In the year 1992, the parties have come to negotiations and under One Time Settlement, 50% of the due was paid to the tune of Rs.3,08,433.80 Ps., but, however, the balance 50% was not paid. That being so, on 19.3.2005, the Managing Director of the Corporation wrote letter on behalf of petitioner No.2, to consider the proposal of OTS with minimum levy of 6% interest, as charged under the original OTS Scheme, since 10.11.1992 on the balance outstanding amount; but the Corporation, in its turn, wrote letter dated 26.9.2005 to the Managing Director of the first petitioner company, to the effect that as on 31.5.2005, the amount due is Rs.35,79,228/-. There is no dispute that the petitioner paid Rs.3,08,433.80 Ps. towards first instalment, representing 50% of the agreed amount, on 10.11.1992 under OTS Scheme and paid the second intalment on 5.8.2004, instead of February, 1993, as agreed. In view of these fact, we are of the considered view that claiming a sum of Rs.35,79,228/- charging interest at 20%, on the balance amount, is quite exorbitant. In view of the fact that the Corporation has taken One Time Settlement into consideration and also received 50% of the due amount, in the year 1992, and subsequently in the year 2004, as is evident from their counter, we are of the considered view that for the payment of balance 50% agreed under the OTS Scheme, the payment of Rs.15,00,000/- (Rupees fifteen lakhs only) made by the appellants today by way of demand drafts, which is received by the respondents, shall be in full and final settlement of the loan account. The Writ Appeal is accordingly disposed of in the above terms. No order as to cost. It is represented by the learned counsel for the appellants that the title deeds mortgaged with the respondents, in relation to their property, were not released. In view of the payments made today in full and final settlement of the loan account, the respondents are directed to release the title deeds free of charge. ____________________ T.MEENA KUMARI, J. __________________ S.ASHOK KUMAR, J. April 28, 2008 MAS.