S THRIMOORTHY CHETTIAR Vs. DEPUTY TAHSILDARALWAYE

JUDGEMENT

(1.) The 1st petitioner, for the purpose of running a Dairy Farm borrowed a sum of Rs. 50,000/- from the 4th respondent Bank by executing a promissory note and both the petitioners creating an equitable mortgage over certain items of immovable properties to secure the loan. The loan was to be repaid at the rate of Rs. 100/- per day and should have been discharged by 5-6-1981. A part of the amount due was paid and there has been long correspondence between the bank and the petitioners as is seen from the documents produced by the Bank. Ultimately, the Bank sought the assistance of the District Collector in getting the outstanding money recovered under the provisions of the Kerala Revenue Recovery Act, 1968 (for short 'the Act'), taking advantage of the notification SRO 797/79 published in the Kerala Gazette No. 29 dated 17-7-1979 issued by the Government of Kerala under S.71 of the Act. Under this notification, it has been declared that the provisions of the Act shall be applicable to the amounts due from any person to any bank on account of any loan advanced to such person by that bank for agriculture or agricultural purposes. Explanation (b) of the notification gives an inclusive definition of the words "agriculture" or "agricultural purpose" so as to include cattle breeding and dairy, farming. The 1st respondent, Deputy Tahsildar, Alwaye, who is evidently incharge of the revenue recovery proceedings, issued demand notice Exts. P2 and P3 to the petitioners on 6-1-1982 under S.34 of the Act calling upon them to pay a sum of Rs. 36,258.60 being the arrears of Bank dues with future interest and bata due in respect of the notice within 10 days from the date of service of the notice and calling upon them to raise objections, if any, to the demand within the period specified. Petitioners have filed the present original petition under Art.226 of the Constitution of India challenging the legality of these two notices.

(2.) Learned counsel for the petitioners contends that the provisions of the Act can be applied only to simple money loan and cannot be applied to secured loan so long as the security is not exhausted. It is further contended that the resort to provisions of the Act would go against the provisions of the Code of Civil Procedure and S.68 of the Transfer of Property Act and therefore the notification cannot be interpreted to apply to secured loans and if it is to be so interpreted, it is unconstitutional. Learned counsel for the petitioners also submitted that Exts. P2 and P3 notices do not contain the relevant particulars mentioned in S.34 of the Act and therefore without anything more, the notices are invalid.

(3.) There is no dispute that the loan was taken from the Bank for the purpose of Dairy Farming. The borrower is a dairy farmer and the purpose of loan is dairy farming. This will attract the notification, No. 797 of 1979, issued by the State Government under S.71 of the Act. S.71 empowers the Government by notification in the Gazette to declare, if they are satisfied that it 'is necessary to do so in public interest that the provisions of the Act shall be applicable to the recovery of amounts due from any person or class of persons to any specific institution or any class or classes of institution and thereupon all the provisions of the Act shall be applicable to any such recovery.