IN THE HIGH COURT OF KERALA
S.S. Satheesachandran, J.
State of Kerala - Appellant
Versus
C.P. Jose and Sons and others - Respondents
S.A. No. 743 of 1995
Decided On : 22-10-2010
Kerala Revenue Recovery Act, 1968 - Section 72 - Suit was one for perpetual prohibitory injunction filed by the 1st respondent, to restrain the State from taking revenue recovery proceedings against that firm for realisation of the amount allegedly due as arrears of public revenue from another viz., M/s. Arthala Tea Estate - Trial Court, after appreciating the materials tendered, dismissed the suit. In the appeal preferred by the plaintiff, an application was moved as I.A. in the present appeal seeking their impleadment as additional appellants contending that by virtue of assignments by the erstwhile partners of the firm, the 1st appellant, they obtained right and title over the suit property and as such, they are entitled to come on record and prosecute the appeal against the dismissal of the suit - Held, Act contains adequate provisions enabling a party, whether it be defaulter or otherwise, to raise such challenge before the competent authority specified and without recourse to such remedies the plaintiff firm, admittedly, claiming under the defaulter, is incompetent to institute the suit was never taken notice of by the lower Appellate Court while it proceeded to segregate the claims as to how far the State is legally entitled to proceed under the R.R. Act for realisation of the various dues from the plaint properties - Whole exercise done by the lower Appellate Court, that too in a suit for injunction, which is prima facie shown to be barred by the provisions of the RR Act, is found to be irregular and wholly unsustainable under law - Dismissal of the suit by the Trial Court, which was unjustifiably interfered with by the lower Appellate Court is liable to be restored - Decree of injunction granted by the Court below is set aside - Appeal Allowed
S.S. Satheesachandran, J.
The defendant State of Kerala in OS No. 103/85 on the file of the Munsiffs Court, Manjeri is the appellant. The above suit was one for perpetual prohibitory injunction filed by the 1st respondent, a registered firm, to restrain the State from taking revenue recovery proceedings against that firm for realisation of the amount allegedly due as arrears of public revenue from another viz., M/s. Arthala Tea Estate. The Trial Court, after appreciating the materials tendered, dismissed the suit. In the appeal preferred by the plaintiff, an application was moved as IA No. 939/90 by respondents 2 to 17 in the present appeal seeking their impleadment as additional appellants contending that by virtue of assignments by the erstwhile partners of the firm, the 1st appellant, they obtained right and title over the suit property and as such, they are entitled to come on record and prosecute the appeal against the dismissal of the suit. That application was allowed by the lower Appellate Court and consequently the present additional respondents 2 to 17 were impleaded as additional appellants 2 to 17 in the appeal. After re-appreciating the materials tendered in the case, the lower Appellate Court reversed the dismissal of the suit in part, holding that out of the several claims raised by the State for realisation resorting to Revenue Recovery proceedings, it is entitled to invoke such proceedings so only in respect of certain claims over which statutory first charge was available and in respect of other claims for which no such charge could be canvassed of the proceedings under the Revenue Recovery Act were impermissible. After examining the various claims of the State, for proceeding under the Revenue Recovery Act against the plaint property, the lower Appellate Court segregated the claims having statutory charges, to which such proceedings were held entertain able and in respect of the other claims, over which there was no statutory charge, proceedings taken under the Revenue Recovery Act were treated as bad, and the realisation of such claims under the Revenue Recovery Act was interdicted granting a decree of injunction in favour of the appellants. The decree so granted by the lower Appellate Court is challenged by the State in the appeal.
2. Respondents 2 to 16 had entered appearance through counsel. Despite repeated notices, service could not be effected on respondents 1 and 17. The 17th respondent was the power of attorney holder of respondents 2 to 16. Taking note that respondents 2 to 17 had got impleaded as additional appellants in the appeal before the lower Appellate Court, and they prosecuted the appeal alleging that the title, interest and interest of the firm over the plaint property proceeded under the Revenue Recovery Act had been assigned in their favour, it was found, no further notice was required against respondents 1, the firm and 17, the power of attorney of respondents 2 to 16.
3. Some of the undisputed facts involved in the case deserve to be taken note of in appreciating the issue projected for consideration, whether the lower Appellate Court was justified in interfering with the dismissal of the suit by the Trial Court. The property covered by the suit admittedly belonged to a tea estate viz., M/s. Arthala Tea Estate. By mortgaging the properties, financial assistance was obtained by that estate from the Kerala State Financial Corporation. Repayment of the loan being defaulted, proceedings were initiated before the competent Civil Court, as provided under the provisions of the Kerala State Financial Corporations Act, which finally led to sale of the properties of the defendants' estate through Court. In the sale conducted by the Court, the 1st respondent firm knocked down the bid, as being the highest bidder. Sale was challenged by the State moving an application under Order 21, Rule 90 of the Code of Civil Procedure contending that the sale proceeded without mentioning and reserving
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