Deepa and Anil Kumar B vs Canara Bank & Deputy Tahasildar, Revenue Recovery, Kollam (W.P.(C) No.16128 of 2022)

W.P.(C). No.16128 of 2022 1 ## **IN THE HIGH COURT OF KERALA AT ERNAKULAM** ## **PRESENT** **THE HONOURABLE MR. JUSTICE SHAJI P.CHALY** **THURSDAY, THE 23[RD] DAY OF FEBRUARY 2023 / 4TH PHALGUNA, 1944 WP(C) NO. 16128 OF 2022** ## **PETITIONERS:** **1 DEEPA VS AGED 44 YEARS WIFE OF ANIL KUMAR, PARANKIMAMVILA PUTHENVEEDU, CHEERANKAVU,EZHUKONE P.O, KOLLAM DISTRICT, PIN - 691505 2 ANIL KUMAR B AGED 51 YEARS SON OF BHASKARAN, PARANKIMAMVILA PUTHENVEEDU, CHEERANKAVU,EZHUKONE P.O., KOLLAM-, PIN - 691505 BY ADVS. B.J.JOHN PRAKASH P.PRAMEL HARISHMA** ## **RESPONDENTS:** - **1 CANARA BANK REPRESENTED BY AUTHORIZED OFFICER, UDAYAGIRI COMPLEX, KADAPPAKADA, KOLLAM-, PIN - 691008** - **2 DEPUTY TAHASILDAR** **REVENUE RECOVERY,MINI CIVIL STATION, KOTTARAKKARA TALUK, KOLLAM, KERALA -, PIN - 691506** **SRI.M.GOPIKRISHNAN NAMBIAR, STANDING COUNSEL FOR R1 SMT.VIDYA KURIAKOSE - GOVERNMENT PLEADER, FOR R2** **THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 23.02.2023, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:** W.P.(C). No.16128 of 2022 2 ## **JUDGMENT** ## **Dated this the 23[rd] day of February, 2023** This writ petition is filed by the petitioners challenging Exhibit P3 revenue recovery action initiated under sections 7 & 34 of the Kerala Revenue Recovery Act, 1968. 2. The basic contention advanced by the petitioners is that by virtue of sections 17 and 18 of the Recovery of Debts and Bankruptcy Act, 1993, the Debt Recovery Tribunal alone is vested with powers to consider a claim of banking or financial institutions exceeding an amount of Rs.20 Lakhs. 3. Heard respective counsel and perused the pleadings and material on record. 4. The aforesaid question was considered by a learned Single Judge of this Court in **Sam J. Mathews and Others v. Deputy Tahsildar (RR) Taluk Office** [2019(4)KHC 105=2019(3)KLT 641=ILR 2019(3)Ker.587] and held as follows: “17. Therefore, viewed from the afore perspective, it is clear that if W.P.(C). No.16128 of 2022 3 any dispute is raised with respect to a debts, as defined by the RDB Act, namely, which is more than Rs.10 lakhs, an adjudication on it can only be done by the DRT under the RDB Act and not by the District Collector under the RR Act. Obviously, therefore, the provisions of S.34(2) of the RR Act would stand in conflict with the afore provisions of the RDB Act and resultantly, cannot be availed of by the Banks. The case of the SARFAESI Act stands on a different pedestal because this is a special Act, brought in subsequent to the RDB Act intended to provide a special mechanism, whereby the Banks can recover debts through the methods specified therein and under the adjudicatory processes that are well defined through its provisions. Thus, even assuming that, in an abstract manner, one views the RR Act to be a mere mechanism for recovery, it would still be of no avail to Banks and Financial Institutions because such recovery, as long as it entails a component of adjudication, would certainly have to yield to the provisions of Ss.17, 18, 19 & 34 of the RDB Act. 18. I must also record that, I have drawn my opinion as above fully inspired and guided by the unmistakable views of the Hon'ble Supreme Court in Allahabad Bank (supra), relating to these issues, which, available in paragraph 23 thereof, are extracted below in order to enable a full reading; “23. Even in regard to “execution”, the jurisdiction of the Recovery Officer is exclusive. Now a procedure has been laid down in the Act for recovery of the debt as per the certificate issued by the Tribunal and this procedure is contained in Chapter V of the Act and is covered by Sections 25 to 30. it is not the intendment of the Act that while the basic liability of the defendant is to be decided by the Tribunal under W.P.(C). No.16128 of 2022 4 Section 17, the banks/financial institutions should go to the civil court or the Company Court or some other authority outside the Act for the actual realisation of the amount. The certificate granted under Section 19(22) has, in our opinion, to be executed only by the Recovery Officer. No dual jurisdictions at different stages are contemplated. Further, Section 34 of the Act gives overriding effect to the provisions of the RDB Act. That section reads as follows: “34.(1) Act to have overriding effect.-- (1) save as provided under subsection (2), the provisions of this Act shall have effect notwithstanding anything inconsistent therewith contained in any other law for the time being in force or in any instrument having effect by virtue of any law other than this Act. (2) The provisions of this Act or the rules made thereunder shall be in addition to, and not in derogation of, the Industrial Finance Corporation Act, 1948 (15 of 1948), the State Financial Corporations Act, 1951 (63 of 1951), the Unit Trust of India Act, 1963 (52 of 1963), the Industrial Reconstruction Bank of India Act, 1984 (62 of 1984) and the Sick Industrial Companies (Special Provisions) Act, 1985 (1 of 1986). The provisions Section 34(1) clearly state that the RDB Act overrides other laws to the extent of “inconsistency”. In our opinion, the prescriptions of an exclusive Tribunal both for adjudication and execution is a procedure clearly inconsistent with realisation of these debts in any other manner. 19. These views were again noticed by the Hon'ble Supreme Court in Unique Butyle (supra) and their Lordships had the following to say, W.P.(C). No.16128 of 2022 5 specifically with respect to the question if the Uttar Pradesh Public Moneys (Recovery of Dues) Act, 1972, which is a similar, if not identical statute as the RR Act, is protected under the RDB Act and as to if its provisions can be utilised by the Bank to recover debts more than Rs.10 lakhs: “9. Section 34 of the Act consist of two parts. Sub-section (1) deals with the overriding effect of the Act notwithstanding anything in consistent therewith contained in any other law for the time being in force or in any instrument having effect by virtue of any law other than the Act. Sub-section (1) itself makes an exception as regards matters covered by sub-section (2). The U.P. Act is not mentioned therein. The mode of recovery of debt under the U.P. Act is not served under the said provision i.e., sub-section (2) which is of considerable importance so far as the present case is concerned. Even a bare reading therein makes it clear that it is intended to be in addition to and not in derogation of certain statutes; one of which is the Financial Act. In other words, a bank or a financial institution as the option or choice to proceed either under the Act or under the modes of recovery permissible under the Financial Act. To that extent, the High Court's conclusions quoted above were correct. Where the High Court went wrong is by holding that the proceeding under the U.P. Act were permissible. The U.P. Act deals with the separate modes of recovery and such proceedings are not relatable to proceedings under the Financial Act.” 20. Thus, cannot be any further cause for speculation on the aspects involved in these cases, since the Hon'ble Supreme Court has, in the above two binding precedents, dispelled it without any trace of doubt. W.P.(C). No.16128 of 2022 6 21. When the law remains established in the afore manner, the axiomatic question is whether the judgments of two other learned Judges of this Court in M/s. Lakshmi Enterprises (supra) and M/s. Amrutha Oils (supra) need to be followed. A reading of M/s. Lakshmi Enterprises (supra), renders it clear that the learned Judge was dealing with a situation where the Bank took the contention that Recovery processes under RDB Act and the RR Act are independent of each other and therefore, that they are entitled to invoke any one of them at their option. The question as to the manner of adjudication of the debt was never considered by the learned Judge and the answer given therein is only with respect to the specific query posed by the Bank in the context of the facts and circumstances involved. 22. Similarly, in M/s. Amrutha Oils (supra), a careful reading of the said judgment would show that there were no disputes on facts therein and the debt was virtually admitted. It is solely in such scenario that the learned Judge delivered judgment without having to enter into any of these issues in detail; and resultantly, therefore, the views in it can only be seen to be confined to the parameters of the specific undisputed facts noticed by the learned Single Judge. 23. Irrefragably, therefore, the seemingly contrary views and conclusions in M/s. Lakshmi Enterprises (supra) or M/s. Amrutha Oils (supra) cannot constrain me in any manner; particularly when they are not in conformity with the declarations in Allahabad Bank (supra) and Unique Butyle (supra). As the necessary denouement, since in all these cases the respondent-Banks are proceeding for recovery of debts which are more than Rs.10 lakhs, I allow these Writ Petitions and direct the concerned Authorities under the Revenue Recovery Act W.P.(C). No.16128 of 2022 7 to cease all further action as per the impugned requisitions made to them; but leave full liberty to the Banks to invoke and pursue remedies under the RDB Act in terms of the afore observations. Needless to say, nothing contained in this judgment shall be construed to mean that the Banks cannot invoke the SARFAESI Act, which they certainly are entitled to do, in terms of law. 5. I am in respectful agreement with the judgment rendered by the learned Single Judge in **Sam J. Mathews** (supra). Therefore, applying the proposition of law evolved by this Court, the writ petition is to be allowed; and accordingly Exhibit P3 notices issued under section 34 and section 7 of the Kerala Revenue Recovery Act, 1968 are quashed. Writ petition is allowed accordingly. Sd/- **SHAJI P.CHALY** smv **JUDGE** W.P.(C). No.16128 of 2022 8 ## **APPENDIX OF WP(C) 16128/2022** **PETITIONER'S EXHIBITS Exhibit-P1 TRUE COPY OF THE DEMAND NOTICE DATED 31.03.2021 ISSUED BY THE RESPONDENT BANK ExhibitP2 TRUE COPY OF THE SUMMONS ISSUED ON OA NO. 31/2022 FILED BY THE RESPONDENT BANK ExhibitP3 TRUE COPY OF THE DEMAND NOTICE DATED 26.01.2022 ISSUED BY THE 2ND RESPONDENT**