IN THE HIGH COURT OF JUDICATURE, ANDHRA PRADESH AT HYDERABAD (Special Original Jurisdiction) THURSDAY, THE TWENTIETH DAY OF AUGUST TWO THOUSAND AND NINE PRESENT THE HON'BLE SRI JUSTICE R.SUBHASH REDDY Writ Petition No.6214 of 2004 Between: Kalluri Sambasiva Rao. ..... PETITIONER AND 1.AP State Finance Corporation, rep. by its Managing Director, Chirag Ali Lane, Hyderabad and 3 others. .....RESPONDENTS ORDER: In this Writ Petition, the petitioner seeks declaration by way of Mandamus to declare the action of respondent Nos.1 and 2 in proceeding under Section 29 of the Andhra Pradesh State Finance Corporation Act, against the collateral security offered by the petitioner for the loan sanctioned in favour of the third respondent-trading firm, as illegal and arbitrary. The first respondent-Andhra Pradesh State Finance Corporation has sanctioned a work capital loan of Rs.7.50 lakhs to the third respondent-firm on 31-03-2000 for which the collateral security of M/s.Navodaya Rice Mill was given. The said Rice Mill was constructed on the land owned by the fourth respondent and is being run by the petitioner as a lessee. As the third respondent-firm defaulted in repayment of the loan amount, proceedings under Section 29 of the Andhra Pradesh State Finance Corporation Act were initiated and M/s.Navodaya Rice Mill at Guntur was seized on 22-10-2003, after issuing recall-cum-sale notice on 03-09- 2003. Subsequently, on 22-03-2004, tender notice was published in the newspaper calling for tenders for sale of collateral security properties. In this Writ Petition, the only argument advanced by the learned Counsel for the petitioner is that though M/s.Navodaya Rice Mill was given as a collateral security, unless the assets of the third respondent-trading firm, which is the principal borrower of loan, are brought to sale, no action can be taken under Section 29 of the Andhra Pradesh State Finance Corporation Act. A bare reading of Section 29 of the Andhra Pradesh State Finance Corporation Act, makes it clear that in exercise of powers under Section 29 for realization of defaulted amount, Financial Corporation is empowered to sell all the securities given thereof for recovering the loan granted by it. Inasmuch as it is not in dispute that M/s.Navodaya Rice Mill is one of the items given as collateral security for the loan amount advanced by the third respondent-firm, it is always open to the first respondent-Corporation to proceed against such security to realize the loan amount when the third respondent-firm defaulted in repayment of the same. As no other argument is advanced, I do not find any merit in this Writ Petition to declare that the proceedings, initiated under Section 29 of the Andhra Pradesh State Finance Corporation Act by respondent Nos.1 and 2, as illegal. For the aforesaid reasons, the Writ Petition is dismissed. No order as to costs. __________________ (R.Subhash Reddy, J) 20th August, 2009 lur