IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT : THE HONOURABLE MR. JUSTICE ANTONY DOMINIC TUESDAY, THE 22ND JULY 2008 / 31ST ASHADHA 1930 WP(C).No. 19965 of 2007(B) -------------------------- PETITIONER: -------------- P.K. MOHANAN, AGED 49 YEARS, S/O. KUNJAPPAN, PARAKKATHAZHATHU,PERIYAPURAM P.O., ONAKKUR, MUVATTUPUZHA. BY ADV. SRI.V.M.KURIAN SRI.MATHEW B. KURIAN SRI.K.T.THOMAS RESPONDENTS: ----------------- 1. KERALA FINANCIAL CORPORATION, THIRUVANANTHAPURAM, REPRESENTED BY ITS MANAGING DIRECTOR. 2. THE BRANCH MANAGER, KERALA FINANCIAL CORPORATION, DISTRICT OFFICE, S.N.D.P. COMPLEX, P.P. ROAD, PERUMBAVOOR. 3. THE DEPUTY COLLECTOR (REVENUE RECOVERY), KERALA FINANCIAL CORPORATION, ERNAKULAM. BY ADV. SRI.P.PARAMESWARAN NAIR, SC, KFC SRI.K.JAJU BABU,SC,KERALA FINANCIAL COR FOR R1,2 THIS WRIT PETITION (CIVIL) HAVING BEEN FINALLY HEARD ON 22/07/2008, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: WPC NO.19965/07 APPENDIX PETITIONER'S EXHIBITS EXT.P1: TRUE COPY OF THE NOTICE OF ATTACHMENT OF IMMOVABLE PROPERTY DT 11.6.2002. EXT.P2: TRUE COPY OF THE NOTICE FOR SALE OF IMMOVABLE PROPERTY DT 11.6.2002. EXT.P3: TRUE COPY OF THE NOTICE DT 9.3.2006 ISSUED BY THE 3RD RESPONDENT. EXT.P4: TRUE COPY OF THE REPRESENTATION DT 17.4.2006 FILED BEFORE THE 3RD RESPONDENT. EXT.P5: TRUE COPY OF THE RECEIPT DT 18.4.2006 ISSUED BY THE 2ND RESPONDENT. EXT.P6: TRUE COPY OF THE LETTER DT 27.2.2007 SENT BY THE 2ND RESPONDENT TO THE PRINCIPAL SECRETARY, FINANCE DEPARTMENT. EXT.P7: TRUE COPY OF THE REPRESENTATION DT 7.4.2007 SENT TO THE 2ND RESPONDENT. EXT.P8: TRUE COPY OF THE REPLY DT 11.5.2007 RECEIVED FROM THE 2ND RESPONDENT. EXT.P9: TRUE COPY OF THE LETTER DT 17.12.2007 ISSUED BY THE 2ND RESPONDENT. EXT.P10: TRUE COPY OF LETTER DT 29.12.2007 SUBMITTED BY PETITIONER BEFORE THE 2ND RESPONDENT. //TRUE COPY// P.A. TO JUDGE ANTONY DOMINIC, J. =============== W.P.(C) NO. 19965 OF 2007 B ==================== Dated this the 22nd day of July, 2008 J U D G M E N T Petitioner was the partner of a firm, which had availed of a loan of Rs.6,72,000/- from the 1st respondent, way back in 1993. It is stated that the loan was availed for establishing a bar attached hotel. At that time, the firm had mortgaged 6 cents of land and another property belonging to the petitioner having an extent of 1.71 acres with a residential building where the petitioner is residing. It is stated that though a hotel building having a plinth area of about 4500 sq.ft was constructed, due to change of policy implemented by the Government, the firm did not succeed in obtaining a bar licence, as a result of which the firm could not commence business and naturally, repayment was also defaulted. 2. Petitioner submits that though as on 31/12/2000, the firm had repaid an amount of Rs.9.5 lakhs, the 1st respondent initiated recovery action under Section 29 fo the SFC Act. Accordingly, the building and 6 cents of land were put for sale under Ext.P2 notice and the notice states that the liability of the firm was for Rs.8,70,373/- with interest from 1/1/2001. It is stated that in pursuance to Ext.P2, the properties were WPC 19965/07 :2 : sold on 3/8/02 and an amount of Rs.10 lakhs was realised. According to the petitioner, though the Corporation even sold the movables and realised further amounts, alleging that Rs.8,70,373/- as on 1/1/2001 is still due, the 1st respondent again issued Ext.P3 notice dated 9/3/2006. Though petitioner applied for OTS, that was rejected by Ext.P6. Further request for OTS made by the petitioner was also rejected. It is at that stage, the writ petition was filed challenging Ext.P3 notice issued by the respondent and the communication rejecting the petitioner's request for OTS. 3. Though the petitioner has several contentions, the main argument that is raised in this writ petition is regarding the amount that is indicated to be due in Ext.P3. Petitioner also submits that if actual amount is quantified and atleast the penal interest is waived, he is willing to pay the amount and settle the liability so that his residential property could be salvaged. 4. I heard the counsel for the petitioner and also the counsel for the respondent who makes reference to the statement filed explaining the amount that is due from the defaulters. 5. In so far as the petitioner's contention about the incorrectness of the amount indicated in Ext.P3 notice is concerned, prima facie there WPC 19965/07 :3 : appears to be some substance which requires to be explained by the respondent. Ext.P2 notice was issued in 2002 and Ext.t P3 notice was issued in 2006. Ext.P2 notice indicated liability of Rs.8,70,373 with interest from 1/1/2001. It is not in dispute that pursuant to Ext.P2, building and 6 cents of land was sold and Rs.10 lakhs was realised. If that be so, it is for the 1st respondent to explain how the very same amount is shown to be due in Ext.P3 notice issued on 9/3/2006. Since this aspect is not explained properly in the statement that is filed, I direct the 2nd respondent to consider this aspect of the matter and give a statement of accounts to the petitioner indicating the liability that is still due from him. 6. It is also directed that it will be open to the petitioner to move the 2nd respondent with an appropriate request for waiver of penal interest that has been levied on him, in which case, while quantifying the liability as above, the 2nd respondent will take note of this request also and pass appropriate orders in this matter. Petitioner shall file an appropriate application before the 1st respondent within 3 weeks from today, and in which case, the 2nd respondent shall consider the matter as directed above and pass appropriate orders and communicate the same to the petitioner. It is directed that until the matter is reconsidered as directed, further WPC 19965/07 :4 : proceedings pursuant to Ext.P3 will be kept in abeyance. I also clarify that it will be open to the petitioner to request for an instalment facility which will also be considered by the 2nd respondent. 7. Writ petition is disposed of as above. Petitioner may produce a copy of this judgment before the 2nd respondent for compliance. ANTONY DOMINIC, JUDGE Rp