THE HON'BLE THE CHIEF JUSTICE UJJAL BHUYAN
AND
THE HON'BLE SRI JUSTICE C.V.BHASKAR REDDY
W.A.No. 170 of 2013
JUDGMENT: (Per the Hon'ble the Chief Justice Ujjal Bhuyan)
Heard Mr. N.Hamsa Raj, learned counsel for the appellants
and Mr. L.Ravichander, learned Senior Counsel for the respondent.
2. This writ appeal has been preferred against the order dated 20.03.2012 passed by the learned Single Judge allowing W.P.No.21183 of 2008 filed by the respondent as the writ petitioner.
3. Respondent as the writ petitioner had filed the related writ petition taking exception to the notice dated 20.08.2004 issued by the appellants for recovery of outstanding dues of Rs.3,29,87,255.00 under the Andhra Pradesh Revenue Recovery Act, 1864 (briefly 'Revenue Recovery Act' hereinafter).
4. According to the respondent, he retired as Senior General Manager of Nizam Sugars Limited and thereafter became a member of the Board of Directors of Nandini Trinity Poly ::2::
Chemical Private Limited, which was subsequently renamed as Pankom Chemicals (briefly 'the company' hereinafter). The company had availed loan from the appellants to the extent of Rs.43,33,811.00. Respondent stood as guarantor. According to the respondent, he had resigned from the company on 13.05.1990 whereafter, he did not have any connection with the company. On 31.08.1999, respondent received a notice raising a demand of Rs.146 lakhs comprising of principal amount of Rs.43.34 lakhs and the balance being interest amount. This was followed by another notice dated 21.09.1999. It was thereafter, that proceedings were initiated vide the order dated 20.08.2004 under Section 52-A of the Revenue Recovery Act demanding Rs.43,33,811.00 towards principal amount and Rs.2,86,50,725.00 towards interest. Aggrieved by the aforesaid, the related writ petition came to be filed.
5. Appellants contested the writ petition by filing counter- affidavit.
6. According to the appellants, they had provided loan to M/s.Chlorate India Limited, which was however sold and ::3::
purchased by the company in 1987 under Section 29 of the State Financial Corporations Act, 1951 (briefly 'the SFC Act' hereinafter). Thereafter, appellants sanctioned further loan to the company. However, the company committed default in repayment of loan for which assets of the company were seized by the appellants under Section 29 of the SFC Act whereafter plant and machinery were sold. This was followed by land and buildings of the company being sold. After adjusting the sale consideration, company still owed a sum of Rs.3,29,87,330.00 as on 30.06.2004. Appellants exercised their right to recover the outstanding dues by invoking Section 52-A of the Revenue Recovery Act.
7. Learned Single Judge considered the rival contentions and noted that even according to the appellants the loan originated in the year 1987. Additional loans were advanced in the year 1989.
8. Learned Single Judge referred to the decision of the Supreme Court in State of Kerala Vs V.R. Kalliyanikutty1 in which Supreme Court held that a debt, which is barred by law of 1 AIR 1999 SC 1305 ::4::
limitation cannot be recovered by resorting to recovery proceedings under the Revenue Recovery Act; the object being speedy recovery of dues and not enlargement of the right to recover. Thereafter, learned Single Judge held as follows:
It is not disputed that this court in catena of cases held that the proceedings under ROR Act cannot lay for recovery of the amount, which was barred by limitation. In similar circumstances where loan was advanced by A.P. State Finance Corporation in the year 1971, this court in N.A. Radha v. State of A.P., [2000(2) ALD 560] held that the claim of the Corporation is barred by limitation and cannot be recovered under the provisions of A.P. ROR Act.
The respondents however rely upon the decision in Jagadish Rai vs. Haryana Financial Corporation [AIR 2008 P&H 50] wherein it was held that the provisions of Limitation Act cannot be made applicable to the proceedings initiated under section 32G of the State Financial Corporations Act because, neither there is any express provision made in the Act referring to the Limitation Act nor any necessary intendment is inferable. However in view of the categorical pronouncement of the apex Court in V.R. Kalliyanikutty's case (supra), that a debt barred by limitation cannot be recovered by resorting ::5::
to the provisions of the ROR Act, which principle has been followed by this court in a number of cases, including one cited above i.e., N.A.Radha's case (supra), it is held that the 2nd respondent-Corporation cannot seek to recover the debt, which is admittedly barred by time by recourse to the proceedings under ROR Act through the first respondent."
9. Though learned counsel for the appellants submitted that the limitation period of three years would commence from the date of sale of the assets of the company in which event, the impugned proceedings would be within time, we are not inclined to accept the said contention. As rightly held by the learned Single Judge, the limitation would commence from the date of default and not from the date of selling of assets for default in repaying the dues. Admittedly, the default occurred prior to 31.08.1999 when respondent was served with the demand notice. That being the position, we decline to interfere with the order passed by the learned Single Judge.
10. Writ appeal is devoid on merit and is accordingly dismissed. No costs.
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As a sequel, miscellaneous petitions, pending if any, stand dismissed.
__________________ UJJAL BHUYAN, CJ _______________________ C.V.BHASKAR REDDY, J Date: 12.10.2022 LUR/PRAT