Revenue recovery purchases solely in the Government's name were challenged where dues also belonged to welfare authorities. The court upheld invalidation of the sales, held suitable Gazette or newspaper publication mandatory, and rejected the objection to extending amnesty benefits. Both State appeals were dismissed.
This page shows the compact analysis of this judgement. The full analysis — procedural history, issue-by-issue holdings with ratio and obiter, advocates, and paragraph-level evidence for every claim — is being added to the record in batches and will appear here when this judgement has been through it.
W.A. Nos. 976 & 1408 of 2014
: 1 :
IN THE HIGH COURT OF KERALA AT ERNAKULAM
PRESENT
THE HONOURABLE THE CHIEF JUSTICE MR.S.MANIKUMAR
&
THE HONOURABLE MR. JUSTICE SHAJI P.CHALY
WEDNESDAY, THE 22ND DAY OF SEPTEMBER 2021 / 31ST BHADRA, 1943
WA NO. 976 OF 2014
AGAINST THE JUDGMENT DATED 05.09.2013 IN WPC 33704/2011 OF HIGH
COURT OF KERALA
APPELLANTS/RESPONDENTS 1 TO 9 & 12 IN THE WRIT PETITION:
BY ADV. SRI. ASWIN SETHUMADHAVAN, SR. GOVERNMENT PLEADER
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RESPONDENTS/PETITIONER & 10 & 11 RESPONDENTS IN THE WRIT PETITION:
A.S.NIVAS, THACHANCODE, KUNNATHUKAL, KARAKONAM POST, NEYYATTINKARA P.O., THIRUVANANTHAPURAM.
BY ADVS. SRI.V.G.ARUN (NEYYATTINKARA) SRI.MILESH.V.PAVIYALA SRI.K.B.PRADEEP SRI.RENJITH B.MARAR SRI.P.VISHNU PAZHANGANAT
THIS WRIT APPEAL HAVING COME UP FOR ADMISSION ON 22.09.2021, ALONG WITH W.A.NO. 1408/2014, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:
W.A. Nos. 976 & 1408 of 2014
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IN THE HIGH COURT OF KERALA AT ERNAKULAM
PRESENT
THE HONOURABLE THE CHIEF JUSTICE MR.S.MANIKUMAR
&
THE HONOURABLE MR. JUSTICE SHAJI P.CHALY
WEDNESDAY, THE 22ND DAY OF SEPTEMBER 2021 / 31ST BHADRA, 1943
WA NO. 1408 OF 2014
JUDGMENT DATED 17.01.2014 IN WPC 22714/2013 OF HIGH COURT OF KERALA
APPELLANTS/RESPONDENTS 1 TO 5 IN W.P.(C):
MEENACHIL TALUK, MEENACHIL TALUK OFFICE, PALA - 686 130.
ADV. SRI. ASWIN SETHUMADHAVAN, SR. GOVERNMENT PLEADER
RESPONDENTS/PETITIONER & 6TH RESPONDENT IN W.P.(C):
BY ADVS.
SRI.VARGHESE C.KURIAKOSE SRI.K.D.BABU,SC,KTWWFB(TODDY WORKERS WE
THIS WRIT APPEAL HAVING COME UP FOR ADMISSION ON 22.09.2021,
ALONG WITH W.A. NO. 976/2014, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:
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Dated this the 22nd day of September, 2021.
JUDGMENT
SHAJI P. CHALY.
The captioned writ appeals are filed by the State Government and its officials challenging the judgments of a learned single Judge in W.P.(C) Nos. 33704 of 2011 and 22714 of 2013 dated 05.09.2013 and 17.01.2014 respectively, whereby the writ petitions were allowed and the sale conducted by the revenue authorities under Section 49 of the Kerala Revenue Recovery Act, 1968 (‘Act, 1968’ for short) were set aside. The subject issue relates to the amounts that were due from the writ petitioners on account of Abkari Workers Welfare Fund Act, 1989 ('Act, 1989' for short) and Kerala Toddy Workers Welfare Fund Act, 1969 ('Act, 1969' for short) in common and the sales tax due from the writ petitioner in W.P.(C) No. 33704 of 2011.
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30 cents of land in Parassala village of Neyyattinkara Taluk belonging to the writ petitioner was put up for public auction on 20.12.1999 and the property was bid by the Government for Re.1 as per the provisions of the Act, 1968. According to the writ petitioner, the sale proceeded as per Exts. P1 to P3 notices dated 15.05.1999, 05.10.1999 and dated nil respectively. As per Ext. P3 notice issued under Section 49(2) of Act, 1968, it was informed that the sale will be conducted on 20.12.1999. However, there were no bidders, which according to the writ petitioner, was due to lack of publication regarding the sale as provided in the Act, 1968 and the Rules thereto.
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illegal and against the provisions of the Act, 1968. The writ petitioner had also a contention that the State Government had purchased the property in its own name, when the amount sought to be recovered was also on behalf of other statutory institutions, which procedure was found to be illegal by a judgment of a Division Bench of this Court in District Collector v. Subaida Beevi [2010 (1) KLT 913], wherein it was held that if the auction was conducted by the State Government and there were no bidders, the Government should have purchased the property on behalf of the requisitioning organisation. Here in this case, the requisitions were made by the authorities under the Act, 1989 and the Act, 1969 to recover the amounts due to them. It is true, amounts were due to the State Government towards the Sales Tax also.
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the State Government in purchasing the property in its name alone, in view of the judgment of the Division Bench of this Court in Subaida Beevi (supra), is illegal and bad.
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Workers' Welfare Fund Act, 1969. Therein also, an extent of 42 cents of landed property was put up for auction and in absentia of bidders, the property was bought by the Government. The very same grounds in regard to the illegal purchase by the Government was advanced by the writ petitioner therein also. It is relevant to note that, the entire amount was paid by the writ petitioner though belatedly, which was accepted by the concerned authorities without any objection.
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the amnesty scheme provided as per G.O.(MS) No. 108/2008/TD dated 26.05.2008 could not have been extended to the writ petitioner, since the sale was confirmed on 09.08.2007. That apart, it was also submitted that merely because amounts were deposited under the amnesty scheme, that would not lead to cancellation of the sale effected under the Act, 1968. Other contentions were also raised.
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W.A. Nos. 976 & 1408 of 2014
shall not be later than 60 days from the date of first sale and give notice of the subsequent sale under sub-Section (4) of Section 49.
(1) The sale shall be by public auction to the highest bidder. The time and place of sale shall be fixed by the Collector or the authorised officer having jurisdiction over the village in which the property is situate.
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(2) Previous to the sale, the Collector or the authorised officer as the case may be, shall issue a notice thereof in English and in Malayalam and also in the language of the locality where such language is not Malayalam, specifying-
(i) the name of the defaulter;
(ii) the position and extent of the land and of his building and other known improvements thereon ;
(iii) the amount of revenue assessed on the land, or upon its different sections;
(iv) the amount for the recovery of which the sale is ordered ;
(v) the proportion of the public revenue due during the remainder of the current financial year; and
(vi) the time, place and conditions of sale.
The notice shall be duly served and published at least thirty days
before the date of sale.
(3) A sum of money not less than fifteen per cent of the bid amount of the immovable property shall be deposited by the person declared to be the purchaser with the officer conducting the sale immediately after such declaration and where the remainder of the
purchase money is not paid within thirty days of the date of the sale, the money so deposited shall be liable to forfeiture.
(4) The officer conducting the sale may, in his discretion, adjourn the sale to a specified day and hour, recording his reasons therefor. If the date to which the sale is so adjourned is within sixty days of the original sale, notice of the adjourned sale shall be published in the taluk and village offices concerned, in the office of the local authority within whose jurisdiction the property is situate and also on some conspicuous part of the immovable property brought to sale. If the date of the adjourned sale is beyond sixty days of the original sale, fresh notice shall be served and published as if it were the original sale.
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(5) where the purchaser refuses or omits to deposit the said sum of money or to complete the payment of the remaining purchase money, the property shall be re-sold at the expenses and hazard of such purchaser, and the amount of all loss and expense which may attend such refusal or omission shall be recoverable from such purchaser in the same manner as arrears of public revenue due on land. Where the immovable property is sold at the second sale for a higher price than at the first sale, the difference shall be the property of the defaulter.
that if the date of the adjourned sale is beyond 60 days of the original sale, fresh notice shall be served and published as if it were the original sale. Admittedly, the sale was adjourned twice and it was on the third occasion, on 20.12.1999, the property was bought in by the Government for Re.1. The case projected by the writ petitioner is that even though a notice was served on him, which was undated, there was no publication of the notice consequent to which there were no bidders. It is an admitted fact that there was no publication of the notice in the manner provided under law. This we say because, Section 75 of Act, 1968 deals with the mode of publication of notices etc., which reads thus:
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(i) by affixture of a copy of the notice, order or list-
(a) where it relates to immovable property, on a conspicuous part of the property ; or
(b) where it relates to movable property, on a conspicuous part of the premises from where the property was attached; and
(ii) by affixture of a copy of the notice, order or list on the office of the village in which, and on the office of the local authority within whose jurisdiction, the attachment or sale takes place.
(2) The Collector or the authorised officer may, in his discretion, publish any notice, order or list in the gazette or in one or two newspapers having circulation in the area in which the attachment or sale takes place or in both.
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petitioners to the Government as well as other statutory authorities; however, the properties were purchased by the Government on its behalf alone, and not on behalf of the Government and the requisitioning authority jointly. The Act, 1968 would apply to any specified institutions only when the Government in contemplation of Section 71 of Act, 1968 notifies in the Gazette declaring that the provisions of the Act shall be applicable for the recovery of amounts due from any person or class of persons to any specified institutions or any class or classes of institutions and thereupon, all the provisions of the Act, 1968 shall be applicable to such recovery. Therefore, a substantial portion of the dues demanded, admittedly was not a due of the Government; but the recovery was made by the Government for and on behalf of the specified institutions namely Kerala Abkari Workers Welfare Fund authority and the Kerala Toddy Workers Welfare Fund authority also.
Going by the scheme of the Act, we are of the view that when a
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notification is issued under Section 71, the provisions of the Act apply mutatis mutandis to the recovery of the amounts due to the said institution. If that be so, in Section 50(2), the words, 'on behalf of the Government' should be read as 'on behalf of the institution concerned'. Therefore, if there was no bidders, the Revenue Recovery Officer could have purchased the property on behalf of the second respondent Bank only. But, in this case, it was purchased on behalf of the State, for Re.1. So, the entire proceedings were vitiated. Therefore, the quashing of the proceedings and the directions issued by the learned Single Judge are sustained, though for a different reason. The reasoning of the learned Judge that Section 50(2) will not apply to recovery proceedings for the institution covered by the notification under Section 71, is not tenable. The said provision also applies mutatis mutandis to the recovery proceedings for such institution. The view taken by the learned Judge in Varkey v. State of Kerala (supra), is in tune with the scheme of the Act. The observation of the learned Judge in Ayisha Teacher v. District Collector (supra), concerning the scope of Section 50, vis-a-vis the revenue recovery proceedings initiated at the requisition of an institution covered by Section 71 of the Act, does not lay down the correct legal position. The view taken by the Division Bench of this Court in Canara Bank v. Thankappan (1989 (2) KLT 74), though not directly applicable to the facts of the case, supports the view that the financial institution will not lose the property, if the Government fail to find a purchaser for it. In the result, the Writ Appeal is dismissed, subject to the clarifications mentioned above.”
Bench, we have no doubt in our mind that the learned single Judge was right in holding that the purchase made by the Government was not in accordance with law. The next question that emerges for
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consideration is as to the nature of publication of the notice in contemplation of Section 49(4) of the Act, 1968. On an analysis of Section 49(4) r/w Section 75(2) of the Act, 1968, it is clear that definite procedures are prescribed for conducting the sale of the property.
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under the provisions of law by making suitable publication so as to attract public attention. This is more so, since in our view, the District Collector or the authorised officer is provided with the discretion to make any publication choosing between the Gazette and in one or two newspapers. If that was not the intention of the legislature, then the option would not have been available in subSection (2) of Section 75 as to the manner in which the publication is to be made, that is, in the Gazette or in one or two newspapers. Which thus also means, sub-Section (2) of Section 75 has to be construed strictly to protect the interest of the writ petitioners, who are the owners of the properties in order to secure maximum price in the bid, and unless and until sufficient publication is made the bid conducted would be an empty formality, which is not the intention of the legislature.
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This is more so when Article 300A of the Constitution of India confers a Constitutional right on the citizens, that they shall not be deprived of their right to property save by authority of law.
“7. Revenue sale is conducted not only to wipe off the revenue dues but also to see that maximum price is fetched to the defaulter since in a revenue sale the interests of the intending purchaser, the defaulter and the mortgagee have to be safeguarded. Duty is cast on the officials to safeguard not only the interests of the Revenue but also the defaulter so as to fetch the maximum amount. Discretion conferred under S.75(2) has to be exercised by the authorities depending upon the facts of each case and the case has to be dealt with in a just and equitable manner. Revenue authorities should know that the defaulter is in distress and between devil and deep sea. Defaulter in a given case would not be in a position to repay the
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amount due to various reasons, such as labour unrest, lack of raw materials, unfavourable market Conditions and host of other reasons. Defaulter in all situations may not be a cheat or swindler. Since revenue authorities are dealing with the properties of Somebody else it is highly necessary that an attempt should be made by them to get maximum price for the property.”
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discretion. Taking into account the above said legal and factual aspects, we are of the considered opinion that the learned single Judge was right in holding that the State Government was not legally correct in conducting the sale of the properties in question, and consequently issuing the appropriate directions.
Needless to say, Writ Appeals fail and accordingly, they are dismissed.
sd/- S. MANIKUMAR, CHIEF JUSTICE.
sd/- SHAJI P. CHALY, JUDGE.
Rv
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ANNEXURES OF W.A. NO. 976/2014:
APPELLANTS' ANNEXURES: NIL
RESPONDENTS' ANNEXURES:
EXT.R1: DEMAND DRAFT ISSUED BY THE FEDERAL BANK, PARASSALA BRANCH DATED 24.09.2013.
EXT.R2: ACKNOWLEDGMENT ON RECEIPT OF THE AMOUNT DATED 03.10.2013. EXT.R3: TRUE COPY OF THE PETITION PREFERRED BY THE PETITIONER BEFORE THE DISTRICT COLLECTOR, THIRUVANANTHAPURAM DATED 24.09.2013.
EXT.R4: TRUE COPY OF THE ORDER OF THE HON'BLE HIGH COURT OF KERALA IN I.A.NO. 16619 OF 2013 IN W.P.(C) NO. 33704 OF 2011 DATED 17.12.2013.
EXT.R5: TRUE COPY OF THE LAWYER NOTICE ISSUED BY THE PETITIONER TO THE FIRST RESPONDENT THROUGH HIS COUNSEL DATED 21.05.2014.
EXT.R6: TRUE COPY OF THE POSTAL RECEIPT OF THE LAWYER NOTICE.
EXT.R7: TRUE COPY OF THE LAWYER NOTICE ISSUED BY THE PETITIONER TO THE 2ND RESPONDENT THROUGH HIS COUNSEL DATED 21.05.2014.
EXT.R8: TRUE COPY OF THE POSTAL RECEIPT OF THE LAWYER NOTICE.
EXT.R9: TRUE TRANSLATED COPY OF G.O(MS) NO.76/13/REVENUE DATED 01.03.2013.
ANNEXURES OF W.A.NO. 1408/2014:
APPELLANT'S ANNEXURES:
ANNEXURE 1: TRUE COPY OF THE CHALLAN DATED 28.11.2000.
ANNEXURE 2: TRUE COPY OF THE PAYMENT RECEIPT DATED 04.10.2013 ISSUED BY TODDY WORKERS WELFARE FUND BOARD.
ANNEXURE 3: TRUE COPY OF THE CERTIFICATE DATED 05.02.2014 ISSUED BY THE KERALA TODDY WORKERS' WELFARE FUND BOARD INDICATING NO DUES.
/True Copy/
P.S to Judge.
3 issues framed by the court
Could the Government purchase properties solely in its own name when recovery covered dues owed both to it and to notified institutions?
Did Sections 49(4) and 75(2) require publication of the sale notice in the Gazette or newspapers?
Was the State's objection to extending the amnesty scheme sustainable?
Colour shows how this judgement treated each authority
District Collector v. Subaida BeeviFollowed¶129
District Collector v. Subaida Beevi [2010 (1) KLT 913]
P. Gopalakrishnan v. The State of Kerala and othersApplied¶146
P. Gopalakrishnan v. The State of Kerala and others [2006 KHC 366]
Mahadevan Pillai v. Kerala financial corporationRelied on¶151
Mahadevan Pillai v. Kerala financial corporation [1997 (2) KLT 46)
6 provisions across 2 enactments
STATE OF KERALA
ABDULKHANI
A.SADASIVAN
CHANDRIKA SADASIVAN
THOMMAN JOSEPH
THE WELFARE FUND INSPECTOR, KERALA TODDY WORKERS WELFARE FUND
S.MANIKUMAR
SHAJI P.CHALY
As recorded by the court registry
Judgements on the same questions, provisions and authorities, from every court
