DHANALAKSHMI BANK Vs. DISTRICT COLLECTOR

JUDGEMENT

(1.) Is the action of the District Collector in refusing to initiate revenue recovery proceedings against respondent Nos. 2 and 3 on the ground that the amount to be recovered exceeds Rs.5 lakhs legal and valid This is the short question that arises for consideration in this petition under Art.226 of the Constitution.

(2.) The petitioner is a scheduled commercial bank. The 2nd respondent availed of an open cash credit facility of Rs.3 lakhs on January 14, 2000 from the petitioner bank. The 3rd respondent, who is the father of the 2nd respondent, was the guarantor and provided the collateral security by way of deposit of title deeds of the property. Necessary documents were executed.

(3.) On account of failure of the respondents to make the deposit, an amount of Rs. 4.30,684.50 had become due from them on December, 30, 2000. Respondent Nos.2 and 3 failed to make the deposit. On January, 14, 2002, the bank issued a demand notice for the recovery of Rs.4,78,250/- which was found to be due on December 31, 2001. The respondents asked for time. Since the deposit was not made the bank approached the District Collector for initiating proceedings for recovery. The letter was returned in original with the following observation: