Dismissed

A.Alavikutty v. Bank of India

Kerala HC14 Jan 2016WA/1067/2013

Case brief

AI extract

What is this about?

In this writ appeal, the High Court dismissed the challenge to the order denying relief against revenue recovery proceedings initiated by a bank under its priority sector lending scheme. The court affirmed the lower court's conclusion that the bank was entitled to initiate recovery and limited the limitation dispute to civil courts.

What did the court decide?

The writ appeal is dismissed; the appellant is directed to avail own the instalment facilities granted by the Single Judge.

A.Alavikutty Vs Bank of India — Cheque Dishonour | Kerala HC (2016)

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IN THE HIGH COURT OF KERALA AT ERNAKULAM

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PRESENT:

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THE HONOURABLE THE CHIEF JUSTICE MR.ASHOK BHUSHAN & THE HONOURABLE MR.JUSTICE A.M.SHAFFIQUE

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THURSDAY, THE 14TH DAY OF JANUARY 2016/24TH POUSHA, 1937

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WA.No. 1067 of 2013 () IN WP(C).5911/2013

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------------------------------------------AGAINST THE JUDGMENT IN WP(C) 5911/2013 DATED 18-06-2013

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APPELLANT/PETITIONER IN WPC :-

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A.ALAVIKUTTY, AGED 52 YEARS S/O. AHAMMED KUTTY, THENGIL HOUSE, NORTH BEACH ROAD P.O WEST HILL, CALICUT - 676 305.

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BY ADVS.SMT.SUMATHY DANDAPANI (SR.) SRI.MILLU DANDAPANI

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RESPONDENTS/RESPONDENTS IN WPC :-

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1. BANK OF INDIA REPRESWENTED BY ITS GENERAL MANAGER (RECOVERY) STAR HOUSE, C-5 "G" BLOCK, BANDRA KURLA COMPLEX BANDRA (EAST), MUMBAI - 400 051.

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2. THE BRANCH MANAGER

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BANK OF INDIA, KOZHIKODE BRANCH, SILK STREET KOZHIKODE - 673 001.

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3. THE VILLAGE OFFICER, PUTHIYANGADI VILLAGE, KOZHIKODE - 673 021.

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4. THE TAHSILDAR (REVENUE RECOVERY), KOZHIKODE - 673 001.

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5. THE DISTRICT COLLECTOR, COLLECTORATE, KOZHIKODE - 673 001.

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R1 & R2 BY SRI.KODOTH SREEDHARAN R3 - R5 BY SR.GOVERNMENT PLEADER SRI.P.I.DAVIS

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THIS WRIT APPEAL HAVING BEEN FINALLY HEARD ON 14-012016, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:

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WA.NO.1067 OF 2013

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APPENDIX

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APPELLANT'S EXHIBITS :-

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ANNEXURE A :- COPY OF THE CIRCULAR, RPCD No.BC 42A/4.9.2011/2003 DATED 11.11.2002 ISSUED BY THE RESERVE BANK OF INDIA.

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ANNEXURE B :- COPY OF NOTIFICATION DATED 1.7.2013 ISSUED BY THE RESERVE BANK OF INDIA VIDE No.RPCD.CO.RRB.BC.No.7/03.05.33/201314.

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ANNEXURE C :- COPY OF THE COMPUTER PRINTOUT OF THE INFORMATION FROM THE WEBSITE OF DEPOSIT INSURANCE AND CREDIT GUARANTEE CORPORATION.

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ANNEXURE D :- COPY OF LETTER DATED 26.3.2013 SUBMITTED BY THE APPELLANT TO THE 2ND RESPONDENT.

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ANNEXURE E :- COPY OF REMINDER LETTER DATED 29.6.2013 SUBMITTED BY THE APPELLANT TO THE 2ND RESPONDENT.

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ANNEXURE F :- COPY OF THE CERTIFICATE OF REGISTRATION SHOWING REGISTRATION No.KL-11/P 8911 ISSUED TO THE APPELLANT.

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RESPONDENT'S EXHIBITS :-

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ANNEXURE R2(a) :- COPY OF THE PROPOSAL PREPARED BY THE DEPUTY MANAGER (CREDIT)/MANAGER.

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ANNEXURE R2(b) :- COPY OF THE LOAN APPLICATION DULY SIGNED BY THE LOAN APPLICANT AND CO-OBLIGANT ALONG WITH THE LOAN PROPOSAL.

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ANNEXURE R2(c) :- COPY OF THE LOAN APPLICATION DULY SIGNED BY THE LOAN APPLICANT AND CO-OBLIGANT.

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ANNEXURE R2(d) :- COPY OF THE RENEWAL LOAN APPLICATION No.LN 605/8544 SIGNED BY THE LOAN APPLICANT.

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ANNEXURE R2(e) :- COPY OF THE RENEWAL LOAN APPLICATION No.LN 732/434 SIGNED BY THE LOAN APPLICANT.

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//TRUE COPY//

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P.A. TO JUDGE

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ASHOK BHUSHAN, C.J & A.M. SHAFFIQUE, J.

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W.A. No.1067 of 2013

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Dated this the 14^th day of January 2016

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J U D G M E N T

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Shaffique, J.

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Heard the learned counsel for the appellant as well as the learned counsel appearing for the Bank.

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The petitioner in W.P.(C) No.5911 of 2013 has filed this writ appeal challenging the judgment dated 18.6.2013, by which, the learned Single Judge disposed of the writ petition, however, leaving open the question raised by the petitioner regarding limitation to be decided in appropriate proceedings and granted instalment facilities to the petitioner to pay the outstanding amount.

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The writ petition was filed by the petitioner when Revenue Recovery proceedings were initiated at the instance of the respondent Bank. It was inter alia contended that the Bank had no right to initiate Revenue Recovery proceedings and that, the claim was barred by limitation.

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The learned Single Judge, after evaluating the respective contentions, observed that the loan application shows

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W.A. No.1067 of 2013

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-: 2 :-

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that the petitioner had availed the loan for the purpose of business and the counter affidavit filed by the Bank clearly indicates that the loan had been given under the priority sector, that is; for development activities. In so far as the loan had been granted taking into account the scheme of the Bank under priority sector and when the credit limits are not exceeding `20 lakhs, it forms part of a development scheme as defined under the Reserve Bank Circular and therefore, the Bank was entitled to initiate Revenue Recovery Proceedings.

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As far as the claim of limitation is concerned, it was observed that the requisition was made well within time and that apart, the petitioner had submitted renewal documents on 1.3.2005, 26.2.2008, 2.2.2009 and 3.11.2010. When the petitioner had disputed the renewal documents, the said issue was left open to be decided in appropriate proceedings before the civil court.

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Learned counsel for the appellant would however submit that the learned Single Judge should have exercised the jurisdiction to consider the issues projected by the petitioner.

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But, in the counter affidavit filed by the respondent Bank, it is clearly indicated that the petitioner had availed two loans and the first loan was availed for purchasing a car for

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W.A. No.1067 of 2013

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-: 3 :-

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travelling purpose in connection with the loan applicant's consultancy service. Therefore, the said loan was treated as a loan advanced to Micro and small and medium enterprises - small business, professional and self employed person etc. coming under the category of priority sector as defined under the Reserve Bank Circular and all such loans granted to such persons with credit limits not exceeding `20 lakhs comes under the definition of Micro and Small enterprises lending. The repayment was to be made from his business income. As far as the second loan is concerned, it was availed for the purpose of purchasing a photocopying machine and other utensils for the purpose of his business. This was also treated as a loan granted to establish a small ancillary business unit under the priority sector as per the Reserve Bank of India guidelines.

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When specific contentions have been urged on behalf of the Bank and it is established that the Bank is entitled to initiate Revenue Recovery proceedings in terms of Sec.71 of the Kerala Revenue Recovery Act as per SRO 1465/1987, we do not think that the learned Single Judge had committed any error in arriving at such a conclusion. As far as the claim of limitation is concerned, when validity of the documents relied upon by the Bank has been

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W.A. No.1067 of 2013

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-: 4 :-

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disputed, the remedy, apparently of the petitioner is to approach the civil court and obtain appropriate orders.

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Under such circumstances, we do not find any error in the judgment of the learned Single Judge. Since there is no merit in the contentions urged, the appeal is dismissed. However, in view of the fact that there was stay in the appeal, it shall be open for the appellant to avail of the instalment facilities as granted by the learned Single Judge with effect from today.

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Sd/-

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ASHOK BHUSHAN

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Sd/A.M. SHAFFIQUE

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Jvt/15.1.2016.

A.Alavikutty v. Bank of India

Case brief

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A.Alavikutty v. Bank of India

Case brief

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