SK,J
W.P.No.6151 of 2009
THE HONOURABLE SRI JUSTICE K.SARATH
WRIT PETITION No.6151 of 2009
ORDER:
This writ petition is filed with the following prayer : .....to issue a writ, order or direction in the nature of Writ of Mandamus declaring the action of the respondents in enforcing a time barred debt against the petitioner through the machinery under the Revenue Recovery Act as wholly arbitrary, illegal and without jurisdiction and void and consequently, declare the demand notice AFC/HB/99- 2000/101, dated 16.08.2000 issued by the 3rd respondent and the consequential notice dated 28.01.2008 issued by the 5th respondent under section 25 of the Revenue Recovery Act as illegal and void.
2. Heard Sri. Satya Sadan, representing Sri.M.P.Chandra Mouli, learned counsel for the petitioner and Sri.M.Hamsa Raj, learned Standing Counsel for the Andhra Pradesh State Financial Corporation.
3. The learned counsel for the petitioner submits that due to the disputes between the partners, which could not be resolved, the petitioner resigned from the Board as a Director on 02.02.1990 and the same was informed to the respondent Corporation with a request to release the petitioner from the obligation of the Company and also filed Form No.32 with 2 SK,J W.P.No.6151 of 2009 Registrar of Companies informing his resignation from the Board as a Director. Since the date of his resignation from the Board as a Director in the year 1990, the petitioner moved away from the affairs of the Company and it is the obligation of the other Directors, who were running the Company to repay the loan to the respondent Corporation. Subsequent to the resignation the petitioner has not received any notice or demand from the respondent Corporation for repayment of loan.
4. The learned counsel for the petitioner further submitted that the Directors who were running the unit have not paid loan to the respondent Corporation and the unit was closed in the year 1995-96. No notice of seizure or sale of the unit was issued to the petitioner. After 10 years of his resignation from the Board as a Director of Company the respondent No.3 issued a notice vide Proceedings AFC/HB/99-2000/101, dated 16.08.2000 demanding the payment of Rs.25,65,373/- and directed petitioner to pay the above said amount within 15 days from the date of the notice, failing which, he will proceed to invoke the provisions of the Andhra Pradesh Revenue Recovery 3 SK,J W.P.No.6151 of 2009 Act for recovery of the dues treating the same as arrears of Land Revenue. The petitioner submitted reply to the respondent Corporation on 04.09.2000 and informing about his resignation and in response to the same, the petitioner has not received any reply from the respondents. Thereafter, the respondents issued notice for attachment of immovable property under Andhra Pradesh Revenue Recovery Act, dated 28.01.2008 and demanding payment of Rs.16,13,600/- towards principle, Rs.1,35,99,093/- towards interest, Rs.77,247/- towards other expenses, in total Rs.1,52,89,940/- with further interest from 01.11.2007 being the arrears of the revenue dues from the petitioner as Director of M/s.Sindu Auto Scan Private Limited.
5. The learned counsel for the petitioner submits that the respondent Corporation cannot seek to recover the time barred debt under the process of Andhra Pradesh Revenue Recovery Act and relied upon the judgment of this Court in A.Laxmipathi and another vs Andhra Pradesh State Financial Corporation Limited, Hyderabad and others1 and prayed to allow the writ petition to set aside the orders passed by the respondent Corporation.
1
2008 (6) ALD 329
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W.P.No.6151 of 2009
6. Sri. Hamsa Raj, the learned counsel for the respondents submits that the petitioner is liable to pay the amounts as per Revenue Recovery Act and relied upon the judgment of the Hon'ble Supreme Court in State of Kerala & others vs V.R.Kalliyanikutty & another2 and requested to dismiss the writ petition.
7. After hearing both sides, this Court is of the considered view that admittedly, the petitioner resigned as a Director from the Board of M/s.Sindu Auto Scan Private Limited Company on 02.09.1990 and the same was communicated to the respondents. The unit was seized and sold by the respondent Corporation under Section 29 of SFC Act in the year 1995-96. No notice of seizure and sale of the unit were issued to the petitioner and the respondents issued demand notice to the petitioner on 16.08.2000 under section 52-A, Andhra Pradesh Revenue Recovery Act and consequential demand notice on 28.01.2008. Similar issue was considered by this Court in A.Laxmipathi and another vs Andhra Pradesh State Financial Corporation Limited, Hyderabad and others1 (supra) after considering the judgment of the Hon'ble Supreme 2 AIR 1999 SC 1305 5 SK,J W.P.No.6151 of 2009 Court in State of Kerala & others vs V.R.Kalliyanikutty2 (supra) held that when the action was initiated under Section 29 of the Act for sale of assets of the borrower, the period of limitation would not apply, and it is only in cases where SFC invokes Section 52-A of Revenue Recovery Act read with Section 32G of the Act, period of limitation applies.
8. In view of the settled legal position, the respondents cannot recover the time barred dues from the petitioner. The demand notice in AFC/HB/99-2000/101 issued by the 3rd respondent on 16.08.2000 and consequential demand notice issued by the 5th respondent on 28.01.2008 are liable to be set aside and the same are set aside. Accordingly, the writ petition is allowed. No costs.
9. Miscellaneous Petitions, if any, pending in this Writ Petition shall stand closed.
________________________________ JUSTICE K.SARATH Date: 22.11.2022.
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W.P.No.6151 of 2009
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THE HONOURABLE SRI JUSTICE K.SARATH
W.P.No.6151 OF 2009
Date: 22.11.2022
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