Welfare Fund Inspector Kerala Toddy Workers' Welfare Fund Board, Kannur v. K.S Antony and others

W.A.No.1678 of 2012 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** **THURSDAY, THE 24[TH] DAY OF NOVEMBER 2022 / 3RD AGRAHAYANA, 1944 WA NO. 1678 OF 2012** **AGAINST THE JUDGMENT IN WPC 8439/2010 OF HIGH COURT OF KERALA** ## **APPELLANT/RESPONDENT NO.5:** **THE WELFARE FUND INSPECTOR KERALA TODDY WORKERS' WELFARE FUND BOARD, KANNUR. BY ADV SRI.G.SANTHOSH KUMAR,STANDING COUNSEL** ## **RESPONDENTS/PETITIONER AND RESPONDENTS 1 TO 4 AND 6:** - **1 K.S ANTONY AGED 63 YEARS S/O.SKARIA, KADAMATHOTT HOUSE, PUTHIYANGADI P.O., ANGADIPURAM, MALAPPURAM DISTRICT - 676 505.** - **2 STATE OF KERALA REP.BY SECRETARY TO GOVERNMENT, DEPARTMENT OF REVENUE, SECRETARIAT, THIRUVANANTHAPURAM - 695 001.** - **3 THE LAND REVENUE COMMISSIONER THIRUVANANTHAPURAM - 695 001.** - **4 THE DISTRICT COLLECTOR KANNUR DISTRICT - 670 001.** - **5 THE TAHASILDAR R.R.. THALASSERY - 670 101.** - **6 K.T.JAMES S/O.THOMAS, KAIPANICKAL HOUSE, ARALOM DESOM, VELIMANOM P.O., THALASSERY, KANNUR - 670 101.** **BY ADV SRI.C.A.CHACKO FOR R1 SRI.K.P.HARISH, SENIOR GOVERNMENT PLEADER FOR R2 TO R5** **THIS WRIT APPEAL HAVING COME UP FOR ADMISSION ON 24.11.2022, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:** W.A.No.1678 of 2012 2 **J U D G M E N T Dated this the 24[th] day of November, 2022** ## **S.MANIKUMAR, CJ.** Being aggrieved by the judgment dated 23[rd] January, 2012 in W.P.© No.8439 of 2010, instant writ appeal is filed. 2. Short facts leading to the filing of the writ appeal are as follows: 3. Appellant was respondent No.5 and writ petitioner was respondent No.1 in the writ petition. The 1[st] respondent purchased 1.40 acres of land comprised in R.S.No.279 of Aralam Village from one K.T.James, Kaipanickal House, Kannur – the 6[th] respondent. By a notice issued in 2005, the Tahsildar (RR), Thalassery – the 5[th] respondent, informed the 1[st] respondent that arrears of welfare fund under the Toddy Workers' Welfare Fund Act were due from the 6[th] respondent. Thereupon, the 5[th] respondent issued Exhibit P1 order dated 17.10.2005 under section 44(2) of the Revenue Recovery Act and invalidated the sale in his favour. First respondent filed an appeal to the District Collector, Kannur District – the 4[th] respondent, which was rejected by Exhibit P3 proceedings dated 21.01.2008. Further, a revision was filed before the Land Revenue Commissioner, which was also rejected as per Exhibit P5. 4. It is submitted by the appellant that the writ court disposed of the writ petition W.A.No.1678 of 2012 3 quashing the revenue recovery proceedings initiated against the 1[st] respondent; that the writ court also observed that the transaction of property in favour of the 1[st] respondent was not with an intend to defeat or delay the recovery of arrears, which were due from the 6[th] respondent, to attract the provisions of Section 44(2) of the Revenue Recovery Act, 1968. According to the appellant, judgment of the learned Single Judge is illegal and arbitrary, warranting interference of this Court under Article 226 of the Constitution of India. ## 5. The operative portion of the said judgment reads thus: "5. There cannot be any dispute that by virtue of Section 44(1) of the Act that any agreement entered into by a defaulter with respect to any of his immovable properties after service of written demand on him, shall not bind the Government. Sub section 2 of the Act provides that any transfer of immovable property made by a defaulter after public revenue due on land from him has fallen in arrears with intend to defeat or delay the recovery of such arrears shall not be binding upon the Government. In this case, records show that the sixth respondent was a toddy shop contractor during the period 1997 to 2001 and that Welfare Fund dues had fallen in arrears during the said period. Therefore, the sale having been effected in favour of the petitioner, subsequently Section 44(1) of the Act can be attracted to the transaction in question provided the respondents succeed in showing that, transfer was after service of a written demand on the defaulter. In this case, the document show that the attachment of the movables were in the year 2003 and the property in question were attached in 2005. No other particulars are forthcoming and therefore, Section 44(1) of the Act cannot be attracted. 6. Coming to Section 44(2) of the Act, respondents can succeed if the transfer in question is shown to be intended to defeat or delay the recovery of arrears. In Ext.P1, the power invoked is under Section 44(2) of the Act and the only W.A.No.1678 of 2012 4 reason stated is that the transfer in question has been effected after the amount had fallen due. In Ext.P3, the appellate order passed by the District Collector also, same is the line of reason. On the other hand, when it comes to Ext.P5, the order passed by the Land Revenue Commissioner is concerned, there is nothing to defeat or delay the recovery of arrears or the lack of bona fides in the transaction is sought to be inferred from certain circumstances. One of the circumstances is that in the revenue recovery sale of a portion of another property conducted in 2004, petitioner was the highest bidder. Yet another circumstances pointed out is that the proceedings against the property purchased by the petitioner were challenged by the defaulter in a writ petition filed before this Court. As far as the first reason stated is concerned, that revenue recovery sale was conducted in 2004 which obviously was long after the petitioner purchased the property in question. Petitioner also has an explanation that the property sold was an adjacent property. In the light of the above facts, I am not persuaded to think that this circumstance indicate any mala fides in the transaction. Insofar as the allegation that the defaulter himself has challenged the revenue recovery action against the properties transferred to the petitioner is concerned, that again by itself will not indicate any lack of bona fides in the transaction. Therefore, I am not satisfied that the respondents have made out a case that the transactions in favour of the petitioner were with intend to defeat or delay recovery of the arrears which were due from the sixth respondent, to attract the provisions of Section 44(2) of the Act. On the other hand, on the materials, petitioner has to be held as a bona fide purchaser entitled to protection under Section 44 (2) of the Act, which right of the petitioner has been recognized by the Division Bench in St.Arnold Divine Works Society v. State of Kerala (2006 (3) KLT, SN 48, C.No.67) referred to above. Therefore, Exts.P1, P3, P5 and P7 are to be quashed and I do so. Writ petition is disposed of as above." W.A.No.1678 of 2012 5 6. Vide order dated 16.11.2022, we directed the learned Senior Government Pleader to ascertain as to whether the recovery of Kerala Toddy Workers' Welfare Fund has been waived by the Government. 7. By inviting attention of this Court to G.O.(Ms) No.16/2021/Labour dated 11.2.2021, learned counsel appearing for respondent No.1, submitted that taking into consideration the grievance of the 1[st] respondent, the arrears of contribution and the interest thereof towards the Toddy Workers Welfare Fund for the period from 1990 to 1991 & 2000 to 2001 have been waived by the Government. 8. The attested copy of the said Government Order produced before this Court by the 1[st] respondent, shall be a part of judgment and the same reads thus: " Government of Kerala ## Abstract Labour and Skills Department completely exempts the defaulted Subscription of Toddy Shop Licensees of Thalassery Range in Kannur District to the Kerala Toddy Workers Welfare Fund for the period 1990- 2001-Orders issued - Reg ____________________________________________________________________ Labour and Skills (B) Department GO (Ms) No 16/2021/Labour Dated, Thiruvananthapuram, 11 02.2021 Reference:- 1 Representation dated 25.07 2017 submitted to the Honourable Chief Minister by the Thalassery Range Toddy Shop Contracters Association. 2. Letters numbered M.R.C./8093/09-18 dated 08.08.2018, 12.10.2018, 26.10.2018, 21.01.2019, 06.07 2019 and 28.10.2019 from the Chief Welfare Fund Inspector, Kerala Toddy Workers Welfare Fund Board. ## **ORDER** The Toddy Shop Contractor's Association, Thalassery Range had submitted an W.A.No.1678 of 2012 6 application cited as Reference(1) before the Government for exempting the defaulted amount for the period 1990-2001 in the Toddy Workers Welfare Fund citing that due to the special political situation prevailing in Thalassery during the period 1990-2001, there was a downfall in the business of toddy shops and the collected toddy had to be destroyed either completely or partially; and hence it became impossible to distribute wages to the employees or to pay subscriptions towards the Welfare Fund, and the Toddy Workers Welfare Fund Board had appropriated the entire amount paid in different installments towards interest amount; and from among the thirty seven defaulters, fifteen had died till date and the said families are suffering a lot of difficulties because of their liabilities. The Chief Welfare Fund Inspector through letter dated 28.10.2019 cited as Reference (2) has intimated that for the period of 1990-91 to 2000-01, Licensees in Thalassery Range, Kannur District have to pay, Rs. 74,73,128/- (Seventy four lakh seventy three thousand one hundred and twenty eight rupees only) towards the principal amount and Rs 2,25,35,259/- (Two crores twenty five lakh thirty five thousand two hundred and fifty nine rupees only) towards interest amount till 15/10/2019 and requested the Government for initiating proceedings for granting a total amount of Rs. 1,49,84,881 (One crore forty nine lakh eighty four thousand eight hundred and eighty one rupees only) which comprises of Rs. 74,73,128/(Seventy four lakh seventy three thousand one hundred and twenty eight rupees only) which is fixed towards the Principal Amount and Rs. 75,11,753/- (Seventy five lakh eleven thousand seven hundred and fifty three rupees only) towards the interest amount for the period till 15/10/2019 as per the 'One time Settlement Scheme' accorded by the Government. The Government perused the matter in detail. During the period of 1990-2001, toddy sale was less due to the Political scenario that prevailed. Hence the collected toddy had to be destroyed partially or completely. Owing to the consequent financial crisis, Shop Licensees of Thalassery Range, had not remitted the amount to be Remitted to Kerala Toddy Workers Welfare fund during the said period. Later, the majority of the amount remitted at several stages was W.A.No.1678 of 2012 7 appropriated for interest. In this scenario, subject to the approval of Kerala Toddy Workers Welfare Fund Board and in exercise of the powers conferred under Sub Section 1, Section 4 (A) of the Kerala ToddyWorkers Welfare fund Act, 1969, and by considering this to be a special case in humanitarian grounds, Orders are hereby issued, with retrospective effect, exempting the remittance of the total amount due comprising the subscription during the said period and the interest thereof. (By Order of the Governor) Satyajith Rajan Additional Chief Secretary Chief Welfare Fund Inspector, Kerala Toddy Workers Welfare Fund Board, Ulloor, Thiruvananthapuram Principal Accountant General (A&E/Audit), Kerala, Thiruvananthapuram Finance Department (vide LBR-2/39/19/Fin dated 23.05.19) Law Department (vide 7118/F1/2020/Law dated 07.05.2020) General Administration (SC) Department (Item No. 4603 dated 10.02.2021) Web & New Media Division, Information and Public Relations Department Stock File/Office Copy By Order, Sd/- Section Officer" W.A.No.1678 of 2012 8 Having regard to the contents of the above said order and waiver, appeal has become infructuous. Accordingly, it is dismissed. Sd/- **S.MANIKUMAR, CHIEF JUSTICE** smv Sd/- **SHAJI P. CHALY, JUDGE** W.A.No.1678 of 2012 9