Back
HIGH COURT OF KERALA
N. NAGARESH, J
M. LOURD MARY – Appellant
Versus
DEPUTY TAHSILDAR (REVENUE RECOVERY) – Respondent
WP(C)/3836/2018
Recovery - Writ Petitions - Kerala Panchayat Raj Act 1994 Section 243(2), Section 210 - Court found recovery attempts time-barred and contrary to principles of natural justice.
Fact of the Case:
Petitioners, retired Panchayat officials, received demands for tax recovery based on an audit report alleging they failed to collect taxes. They argued the recovery was illegal due to lack of notice and being barred by limitation.
Finding of the Court:
The court ruled that the recovery proceedings violated natural justice principles as no prior notice was issued. Additionally, the recovery was deemed time-barred since it was sought more than four years after the tax was assessed.
Issues: The core issues included whether the recovery was permissible under the Kerala Panchayat Raj Act and whether principles of natural justice were upheld.
Ratio Decidendi: The court emphasized that recovery of amounts must comply with statutory provisions and respect for natural justice. The lack of notice and the time-barred nature of the claim rendered the actions against the petitioners unlawful.
Final Decision: Writ petitions allowed; recovery notices quashed.
J U D G M E N T
~ ~ ~ ~ ~ ~ ~ ~ ~
Dated this the 24th day of August, 2021 [WP(C) Nos.3836 & 4077 of 2018]
These writ petitions have been filed based on the same set of facts and seek similar reliefs. Hence, they are heard together and are being disposed of by a common judgment.
2. The petitioner in W.P.(C) No.3836/2018, while working as Assistant Secretary of Grama Panchayat, retired from service on superannuation on 31.07.2017. She had worked in five Grama Panchayats while in service and Secretaries of all these Panchayats issued Non Liability Certificate to the petitioner. However, after retirement, the petitioner was served with Ext.P5 letter dated 22.12.2017 of the 4th respondent alleging that the petitioner failed to collect `
taxes amounting to 26,718/- as per the Audit Report 2000-2001 when she worked in Thirunelly Grama Panchayat.
The petitioner submitted Ext.P6 reply denying the allegation and pointing out that she has been given a non-liability certificate for the said period.
3. Subsequently, Ext.P7 demand notice dated `
17.01.2018 for an amount of 89,769/- inclusive of interest was served on the petitioner requiring her to pay the amount within 10 days. The petitioner gave Ext.P8 reply on 27.01.2018. A further letter dated 24.09.2010, Ext.P10, of the 4th respondent was served on the petitioner to which the petitioner submitted Ext.P11 reply dated 24.10.2010. The petitioner challenges Ext.P5 and Ext.P7.
4. The petitioner in WP(C) No.4077/2018, who also retired from Panchayat service on 30.06.2014, was served with Ext.P2 letter of the 4th respondent demanding ` 26,718/- based on the same Audit Report for the year 2000-2001 on Thirunelly Panchayat. Later, Ext.P3 Demand Notice dated `
17.01.2018 was served on the petitioner demanding 89,769/- inclusive of interest. The petitioner in WP(C) No.4077/2018 challenges Exts.P2 and P3.
5. The counsel for the petitioners pointed out that the proceedings initiated against the petitioners are under Section 243 (2) of the Kerala Panchayat Raj Act , 1994 and argued that the said provision can be invoked only against defaulters. If any tax payer has defaulted in remittances, the Secretary of the Panchayat ought to have invoked Section 210 of the Act, 1994. No enquiry whatsoever was made before initiating the proceedings against the petitioners, contended the counsel for the petitioner. The recovery is barred by limitation also, it was contended.
6. The 5th respondent-Deputy Director, Local Fund Audit Department filed counter affidavit contesting the writ petitions. The 5th respondent stated that audit of accounts of Thirunelly Grama Panchayat for the year 2000–2001 was conducted in the year 2005. An audit report dated 20.09.2006 was issued by the 4th respondent-Secretary as required under Section 13 of the Act, 1994. In the said Audit Report, it was `
stated that the Panchayat has sustained a loss of 80,152/- being profession tax arrears which became non-recoverable as they are time-barred. In the circumstances, it was decided to recover the amount from the officers concerned along with interest at the rate of 12%.
7. Heard the learned counsel for the petitioners, the learned Government Pleader representing respondents 1 to 3, 5 and 6 and the learned Standing Counsel representing the 4th respondent.
8. The petitioners are employees who retired on superannuation from Panchayat Service. They were issued with Non Liability Certificates also. But, later based on an audit report of the year 2005 in respect of the period 2000-2001 relating to Thirunelly Panchayat, it was noted that professional tax from certain persons were not levied and are now not leviable from them in view of the expiry of the period of limitation. Accordingly, the respondents decided to recover the said amount from the erring officials.
9. Admittedly, the petitioners have not been issued with any notice neither before fixing the liability on them nor on computation of the amounts due from them. Therefore, the principles of natu
An indispensable Tool for Legal Professionals, Endorsed by Various High Court and Judicial Officers
Please visit our Training & Support
Center or Contact Us for assistance
Scan Me!
India’s Legal research and Law Firm App, Download now!
For Daily Legal Updates, Join us on :
Back to top
