K.V. Raman Pillai v. State of Kerala represented by the Secretary to Government, Department of Taxes, Thiruvananthapuram, Kasaragod Taluk Kalu Chethu Vyavasaya Thozhilali Co-operative Society Ltd. (No.S.311) represented by its Secretary

## **IN THE HIGH COURT OF KERALA AT ERNAKULAM** ## **PRESENT:** ## **THE HONOURABLE MR.JUSTICE C.K.ABDUL REHIM** **THURSDAY, THE 31ST DAY OF JANUARY 2013/11TH MAGHA 1934** **WP(C).No. 7797 of 2009 (T) --------------------------** **PETITIONER:** **------------** **K.V.RAMAN PILLAI, AGED 53 YEARS, S/O.VELUKUTTY, PERINGANAM HOUSE MUNNAD P.O., CHENGALA (VIA), KASARGOD DISTRICT.** **BY ADV. SRI.M.SASINDRAN** **RESPONDENTS:** **-------------** **1. STATE OF KERALA, REPRESENTED BY THE SECRETARY TO THE GOVERNMENT, DEPARTMENT OF TAXES THIRUVANANTHAPURAM.** **2. THE ASSISTANT EXCISE COMMISSIONER, KASARAGOD.** **3. THE TAHSILDAR (R.R)KASARAGOD.** **4. KASARAGOD TALUK KALU CHETHU VYAVASAYA THOZHILALI CO-OPERATIVE SOCIETY LTD. (NO.S.311) REP.BY ITS SECRETARY.** **R1-3 BY SENIOR GOVERNMENT PLEADER SRI.ALOYSIUS THOMAS** **THIS WRIT PETITION (CIVIL) HAVING BEEN FINALLY HEARD ON 31-01-2013, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:** **vk** ## **WP(C).No. 7797 of 2009 (T)** ## **--------------------------** **APPENDIX --------** ## **PETITIONER'S EXHIBITS** **----------------------** **EXT.P1. COPY OF THE JUDGMENT DATED 2.8.2001 IN O.P.NO.17520 OF 2001. EXT.P2. COPY OF THE NOTICE NO.KS7-615/2002 DATED 15.4.2002 TO THE PETITIONER.** **EXT.P3. COPY OF THE REPLY DATED 23.5.2002** **EXT.P4. COPY OF THE DEMAND NOTICE DATED 2.7.2002 UNDER SECTION 7 OF THE R.R.ACT.** **EXT.P4(A). COPY OF THE ATTACHMENT NOTICE UNDER SECTION 34.** **EXT.P5. COPY OF THE LETTER DATED 11.7.2002** **EXT.P6. COPY OF THE ATTACHMENT ORDER DATED 24.8.2002.** **EXT.P7. COPY OF THE REPRESENTATION DATED 12.11.2002 BEFORE THE DISTRICT COLLECTOR KASARAGOD.** **EXT.P8. COPY OF THE SALE NOTICE DATED 23.12.2002** **EXT.P9. COPY OF THE JUDGMENT DATED 7.2.2007 IN O.P. NO.2972 OF 2003.** **EXT.P10. COPY OF THE NOTICE DATED 19.11.2008 ISSUED BY THE 3RD RESPONDENT TO THE PETITIONER.** **EXT.P11. COPY OF THE NOTICE DATED 16.1.2009 AND ITS KANNADA AND MALAYALAM VERSION.** **EXT.P12. COPY OF THE NOTICE DATED 24.2.2009 SCHEDULING SALE OF THE PETITIONER'S PROPERTY TO 20.3.2009 AT 11 A.M.** **RESPONDENT'S EXHIBITS** **---------------------** **ANNEXURE R2(A). COPY OF THE PERMANENT AGREEMENT HAVE ENTERED INTO BETWEEN THE PETITIONER AND THE GOVERNMENT.** **ANNEXURE R2(B). COPY OF THE GAZETTE NOTIFICATION (G.O.(P) NO.26/01/TD DATED 17.3.2001).** **/ TRUE COPY /** **P.A. TO JUDGE** **VK** ## C.K.ABDUL REHIM,J. --------------------------------WP(C).NO. 7797 of 2009 --------------------------------Dated this the 31[st] day of January, 2013 ## JUDGMENT The petitioner is the president of the 4[th] respondent Society, which was conferred with privilege of vending toddy in shop No. 1 to 23 of Kasaragod Range, shop No.1 to 32 of Kumbala Range and shop No. 1 to 29 of Badiadka Range, for the year 2001-02. Licence of the 4[th] respondent was cancelled by the 2nd respondent after two months of conducting the toddy shops, alleging non payment of security deposit in full. The 4[th] respondent society could not run the toddy shops thereafter. An amount of Rs.5,45,000/- deposited by the Society was forfeited. In Ext.P1 judgment of this court direction was issued for restoration of the licence, subject to payment of up to date arrears. But the society could not continue the business after remitting the arrears. The respondents initiated steps for realising balance kist amount due for the entire year, from the Society. Ext.P2 notice in this regard was issued to the petitioner as President of the Society, requiring him to pay a sum of WP(C).7797 /2009 2 Rs.36,18,190/-. Eventhough the petitioner submitted Ext.P3 objections, revenue recovery steps were initiated against him as evident from Exts.P4 and P4(a). When coercive steps of recovery was initiated against person and properties of the petitioner, he had approached this court in OP.No.2972/2003. In Ext.P9 judgment this court relied on a Division Bench decision in **Suseelan vs. State of Kerala (2002(1) KLT 226)** and directed the 3[rd] respondent to look into the objections submitted by the petitioner and to take appropriate decision in the light of the said decision. According to the petitioner, no decision was taken or communicated in compliance of Ext.P9 judgment. On the other hand, further coercive steps for attachment and sale of immovable property belonging to the petitioner was initiated as evidenced from Exts.P11 and P12. Aggrieved by such coercive steps initiated against the personal properties of the petitioner, this writ petition is filed. 2. In the counter affidavit filed by the 3[rd] respondent it is contended that, under section 79(2) of the Co-operative Societies Act, any sum due from a Co-operative Society to the WP(C).7797 /2009 3 Government can be recovered from the members of the society subject to the limit of their liability. It is further contended that, conditions of the licence says that the person who had participated in the auction and signed the documents is liable for all the acts and omissions. Since the petitioner had represented the society while participating in the auction and since he had signed documents, he is personally liable, is the contention. 3. Petitioner had participated in the auction and signed the agreement only on behalf of the 4[th] respondent society. It is pointed out that, as per relevant provisions contained in the Abkari Shops Disposal in Auction Rules 2001, grant of privilege for vending toddy was limited to workers Co-operative Society alone. Hence there cannot be any dispute that the privilege was granted to the 4[th] respondent society. That being so, merely because the petitioner had executed the requisite agreement for grant of licence, he cannot be held personally liable and no recovery steps can be pursued against his personal properties. In **Suseelan's case** (citied supra) it is held that no arrears due WP(C).7797 /2009 4 under the Toddy Workers Welfare Fund Act can be recovered from the Secretary of the Co-operative Society and that such person cannot be made personally liable for the default of the Society. Referring to the provisions contained in the Toddy Workers Welfare Fund Act this court held that Secretary of the Co-operative Society will not fall within the definition of employer because the person who employ the worker is only the Society and the office bearers of the Society cannot be made liable. Question remains as to whether the petitioner can be held personally liable because he had signed the agreement with respect to grant of licence. As per section 79(2) of the Kerala Co-operative Societies Act the liability of members of a Society or an office bearer of the Society is limited to the extent of the share held by each such members in the society. On the basis of such legal position the revenue recovery steps initiated against personal properties of the petitioner cannot be sustained. Therefore, I am of the considered opinion that, Revenue recovery steps now initiated pursuant to Ext.P11 and P12 are unsustainable. Accordingly the writ petition is allowed and WP(C).7797 /2009 5 Exts.P11 and P12 are hereby quashed. 4. However, it is made clear that the respondents will be free to proceed against the 4[th] respondent Society for realisation of the arrears by resorting to methods allowable under law or against sureties if any, who stood as guarantors for payment of amounts due under the agreement. C.K.ABDUL REHIM, JUDGE pmn/ WP(C).7797 /2009 6