Madras High Court
Gvg Industries Private Limited vs The District Collector on 17 November, 2021
W.P.No.32913 of 2019
IN THE HIGH COURT OF JUDICATURE AT MADRAS
DATED : 17.11.2021
CORAM
THE HONOURABLE MR.JUSTICE G.K.ILANTHIRAIYAN
W.P.No.32913 of 2019
and W.M.P.Nos. 33347 and 33348 of 2019
GVG Industries Private Limited,
54/2, Jothi Nagar, Venkatesa Mills Post,
Udumalpet - 642128.
Represented by its Office Manager
R.Damodharan. ... Petitioner
-Vs-
1. The District Collector,
Thiruppur District.
2. The Chairman and Managing Director,
SIPCOT, Rukmani Lakshmipathy Road,
Egmore, Chennai - 600 008.
3. The General Manager,
SIPCOT, Rukmani Lakshmipathy Road,
Egmore, Chennai - 600 008.
4. The Thasildhar,
Udumalpet,
Thiruppur District. ... Respondents
Page 1 of 9
https://www.mhc.tn.gov.in/judis
W.P.No.32913 of 2019
Prayer :- Writ Petition filed under Article 226 of the Constitution of
India praying for the issuance of a Writ of Certiorari, calling for the
records pertaining to the impugned proceedings of the first respondent
dated 05.08.2019 in Na.Ka.No.8598/2019/E3 and the consequent
proceedings of the fourth respondent herein dated 22.08.2019 in
Na.Ka.No.4492/2019/A5 and quash the same.
For Petitioner : Mr.R.Nalliyappan
For R1 and R4 : Mr.A.Selvendran
Special Government Pleader.
For R2 and R3 : Mr.M.Karthikeyan
ORDER
This Writ Petition has been filed for the issuance of a Writ of
Certiorari, calling for the records pertaining to the impugned proceedings
of the first respondent dated 05.08.2019 in Na.Ka.No.8598/2019/E3 and
the consequent proceedings of the fourth respondent herein dated
22.08.2019 in Na.Ka.No.4492/2019/A5 and quash the same.
2. Heard Mr.R.Nalliyappan, learned counsel appearing for the
petitioner, Mr.A.Selvendran, learned Special Government Pleader
appearing for the respondents 1 and 4 and Mr.M.Karthikeyan, learned
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W.P.No.32913 of 2019
counsel appearing for the respondents 2 and 3.
3. The petitioner availed the Term Loan Interest Free Sales
Tax facility from second respondent and the petitioner was sanctioned
Rs.1,00,00,000/- (Rupees One Crore only). Against which the petitioner
availed a sum of Rs. 31.16 Lakhs and the same has been already repaid
in the year 2002 itself. Upon discharging the said term loan, the third
respondent had issued No due certificate on 05.04.2002. In pursuant to
the same, the documents which were pledged for availing the said loan
was also released by the second and third respondents in the month of
February 2002 itself. However, the petitioner received the impugned
proceedings on the file of the first respondent, dated 05.08.2019 and the
fourth respondent initiated action under the Section 41 of Revenue
Standing Order read with Section 5 of the Revenue Recovery Act, 1864
to recover the unpaid due amount with its interest to Rs. 4,29,742/-
(Rupees Four Lakhs Twenty Nine Thousand Seven Hundred and Forty
Two only) to the second respondent.
https://www.mhc.tn.gov.in/judis
W.P.No.32913 of 2019
4. A perusal of the counter filed by the second and third
respondents revealed that after sanctioning the loan to the rate of
Rs.1,00,00,000/- (Rupees One Crore only) by the second respondent and
disbursed a sum of Rs. 31.16 lakhs during the year 1983. However, the
petitioner was issued No Due Certificate and later pointed out that the
petitioner is in arrears of IFST loan, Principal of Rs.1,13,033/- (Rupees
One Lakh Thirteen Thousand and Thirty Three only), along with the
interest thereon. Therefore, by the letter dated 27.09.2002, requested the
petitioner to remit the said loan with interest. It was replied that they are
not in arrear of any amount as requested by the second respondent.
Therefore, the second respondent had sent a demand notice dated
21.05.2018, requesting the petitioner and their guarantors to pay the dues
within a period of 30 days. Even after the request, the petitioner did not
pay the sum and as such the second respondent requested the
Government to recover the said due by invoking “Tamil Nadu Revenue
Recovery Act, 1864. On the said request, the first respondent authorized
the fourth respondent to recover the dues from the petitioner. Thereafter,
the fourth respondent issued the impugned proceedings, thereby called
upon the petitioner to pay the sum of Rs.4,29,742/- (Rupees Four Lakhs
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W.P.No.32913 of 2019
Twenty Nine Thousand Seven Hundred and Forty Two only).
5. The learned counsel for the petitioner would submit that
before issuance of the impugned proceedings, dated 22.08.2019, the
petitioner was not heard and he was not served any notice for any
enquiry. Before passing the impugned demand notice, the petitioner
should have been heard and the petitioner is entitled to submit the
documents to prove that he repaid the entire loan amount.
6. In support of his contentions, he relied upon the judgment
reported in 1975 88 LW 383 in the case of "P.A.Aliyar Sheb and 288
others vs. Independent Dy. Tahsildar, Pallipattu, Chingleput and
others", held as follows:-
"Therefore, in my opinion, the result of the above
decisions is that in a case where the amount is recoverable only as "sum
due to the State Government" falling within the scope of S.52 of the
Revenue Recovery Act and where a person from whom the said amounts
is sought to be recovered disputes either the existence of his liability or
the extent of his liability, before resort to the provisions of the Revenue
Recovery Act can be had, there must be an enquiry by the State in which
the alleged defaulter is entitled to participate and wherein the basis of the
liability as well as the amount claimed by the State must be made known
to the alleged defaulter who is given an opportunity to place all the
materials and circumstances which, in his opinion, go to exclude or
eliminate his liability itself or to reduce the liability, and a determination
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W.P.No.32913 of 2019
based on such enquiry should be arrived at with reference to the
existence or the extent of the liability of the defaulter.
7. In view of the above judgment, the petitioner must be given
an opportunity before passing the impugned order. A perusal of the
records, on the request made by the second respondent, the first
respondent authorized fourth respondent to recover the due under the
Revenue Recovery Act, 1864. Accordingly, the fourth respondent issued
impugned notice, thereby directed the petitioner to pay the due to the tune
of 4,29,742/- (Rupees Four Lakhs Twenty Nine Thousand Seven
Hundred and Forty Two only). In the said impugned proceedings, no
reference was made in respect of the issuance of notice of any enquiry.
8. Considering the above, the impugned order passed by the
fourth respondent cannot be sustained and it is liable to be set aside.
Accordingly, the impugned order dated 22.08.2019 in
Na.Ka.No.4492/2019/A5, passed by the fourth respondent alone is
hereby set aside.
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W.P.No.32913 of 2019
9. The fourth respondent is directed to issue notice to the
petitioner and the second and third respondents and after giving them an
opportunity of hearing, pass orders on the request made by the second
respondent within a period of eight weeks from the date of receipt of a
copy of this order. It is ordered to proceed under the "Tamil Nadu
Revenue Recovery Act, 1864".
10. In the result, this writ petition is partly allowed.
Consequently, connected Miscellaneous petitions are closed. There shall
be no order as to costs.
17.11.2021
Internet : Yes
Index : Yes/No
Speaking order/Non-speaking order
mn
https://www.mhc.tn.gov.in/judis
W.P.No.32913 of 2019
To
1. The District Collector,
Thiruppur District.
2. The Chairman and Managing Director,
SIPCOT, Rukmani Lakshmipathy Road,
Egmore, Chennai - 600 008.
3. The General Manager,
SIPCOT, Rukmani Lakshmipathy Road,
Egmore, Chennai - 600 008.
4. The Thasildhar,
Udumalpet,
Thiruppur District.
https://www.mhc.tn.gov.in/judis
W.P.No.32913 of 2019
G.K.ILANTHIRAIYAN, J.
mn
W.P.No.32913 of 2019
and W.M.P.Nos. 33347 and 33348 of 2019
17.11.2021
https://www.mhc.tn.gov.in/judis
