IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT : THE HONOURABLE MR. JUSTICE C.N.RAMACHANDRAN NAIR WEDNESDAY, THE 24TH JUNE 2009 / 3RD ASHADHA 1931 WP(C).No. 34065 of 2005(E) -------------------------- PETITIONER(S): --------------- K. SREEDHARAN, S/O.LATE KRISHNAN, KARIKKANDATHIL HOUSE, P.O. PONANI,MALAPPURAM DIST. BY ADV. SRI.T.KRISHNAN UNNI, SENIOR ADVOCATE RESPONDENT(S): --------------- 1. KERALA FINANCIAL CORPORATION, REPRESENTED BY ITS MANAGING DIRECTOR, VELLAVAMBALAM, THIRUVANANTHAPURAM. 2. THE CHAIRMAN, KERALA FINANCIAL CORPORATION, THIRUVANANTHAPURAM. ADV. SRI.T.V.GEORGE, SC, KFC FOR R1&2 THIS WRIT PETITION (CIVIL) HAVING BEEN FINALLY HEARD ON 24/06/2009, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: APPENDIX PETITIONER'S EXHIBITS: P1: TRUE COPY OF THE SETTLEMENT DEED DT.1.7.2000 ISSUED BY KFC. P2: TRUE COPY OF LETTER ISSUED BY KFC DT.19.12.2002. P3: TRUE COPY OF EXTRACT SHOWING PAYMENTS MADE BY THE UNIT DT.NIL. P4: TRUE COPY OF THE REPRESENTATION BEFORE THE M.D., KFC DT.12.5.2005. P5: .DO. 2ND RESPONDENT DT.22.7.2005. P6: TRUE COPY OF THE COMMUNICATION FROM K.F.C. DT.19.9.2005. P7: TRUE COPY OF THE JUDGMENT IN WPC NO.27788/05 DT.13.10.2005. P8: TRUE COPY OF NOTICE ISSUED BY DISTRICT INDUSTRIES CENTRE, MALAPPURAM DT.30.11.2005. P9: TRUE COPY OF LETTER ISSUED BY KFC ON 24.10.2005. P10: TRUE COPY OF BANK GUARANTEE DT.9.11.2005 FROM SOUTH INDIAN BANK, PONANI. P11: TRUE COPY OF THE LETTER ACKNOWLEDGING THE RECEIPT OF BANK GUARANTEE FROM MALAPPURAM OFFICE OF THE CORPORATION DT.11.11.2005. P12: TRUE COPY OF THE COMMUNICATION DT.16.11.2005 FROM KFC TO THE PETITIONER. P13: TRUE COPY OF THE COMMUNICATION DT.29.11.2003 ISSUED BY KFC TO THE PETITIONER. TRUE COPY PA TO JUDGE C.N.RAMACHANDRAN NAIR, J. .................................................................... W.P.(C) No.34065 of 2005 .................................................................... Dated this the 24th day of June, 2009. JUDGMENT The petitioner settled liability to KFC under One Time Settlement scheme. Balance demand under challenge is interest on belated payment of OTS amount which is only 10% p.a. I do not find any justification to interfere with the demand because if OTS amount is not paid in time, then KFC had the option to deny the OTS benefit to the petitioner as time for payment is the essence of OTS scheme. Therefore, demand of interest is sustained and KFC is free to adjust the interest amount from out of retained amounts. So far as collection charge is concerned, since no sale was effected in recovery proceedings, Government is not entitled to recover collection charges from KFC and therefore, KFC should not recover it from the petitioner. The demand of collection charge is, therefore, cancelled. The W.P. is allowed in part as above. C.N.RAMACHANDRAN NAIR Judge pms