PREM KUMAR Vs. STATE OF HARYANA

JUDGEMENT

(1.) THIS judgment shall dispose of C. W. P. Nos. 15808 of 2006 and 14003 of 2007. Challenge in these petitions filed under Article 226 of the Constitution is to the Notification dated 10-11-2005, issued by the respondent-State under Section 32g of the State Financial Corporations Act, 1951 (for brevity, 'the Act'), appointing Managing Director of the Haryana financial Corporation as 'specified Authority', and recovery certificate dated 2-5-2006, issued by the managing Director-respondent No. 2 by exercising power in pursuance to the aforementioned notification.

(2.) BRIEF facts of the case being referred from C. W. P. No. 15808 of 2006, are that the petitioners are partners of Haryana Refineries, hisar, which is small scale industrial Unit set up in the year 1995. The haryana Financial Corporation-respondent nos. 2 and 3 sanctioned a loan of Rs. 16 lacs in the year 1996 to the petitioners' unit, however, upto 17-3-1997 an amount of Rs. 12,81,000/- was disbursed. It is claimed that the petitioners paid instalments on 27-10-1997, 13-1-1998, 13-2-1998,27-2-1998 and an amount of Rs. 50,000/- was paid on 15-4-1998. Further an instalment of Rs. 1,35,000/- is stated to have been paid in april, 1998. The case of the petitioners is that due to non-disbursement of complete sanctioned loan amount, the unit of the petitioners became sick. In August, 1998, the unit as well as collateral security i. e. house of the petitioners, were taken over by the respondent-Corporation. The unit of the petitioners were auctioned on 5-11-2001 for a sum of Rs. 4,00,000/- and the house was sold in the month of July, 2002 for a sum of rs. 3,25,000/ -. It has been asserted that house of one of the partner was also sold for rs. 1,85,000/ -. On 2-5-2006, respondent no. 2 sent a recovery certificate under section 32-G of the Act, for effecting recovery of Rs. 68,08,841/- against all the partners including the petitioners, to the Collector, jind (P-l ). After receiving the request from the respondent-Corporation, the Collector asked the Tahsildar to recover the amount under the Land Revenue Act. It is alleged that at the instance of Shri N. K. Aggarwalrespondent no. 4, who is Branch Manager of the respondent-Corporation at Hisar, even petitioner No. 1 was arrested on 19-9-2006 and put in civil prison. It is claimed that the loan amount has already been recovered from the petitioners by selling the unit as well as collateral security and the amount already deposited by the petitioners, therefore, recovery certificate for recovery of Rs. 68,08,841/- has been illegally issued, which is time barred, inasmuch as, the possession of the unit was taken in 1998 and recovery certificate was issued on 2-5-2006 after about 8 years. Relying upon the judgment of Hon'ble the Supreme Court in the case of state of Kerala v. V. R. Kalliyani Kutty, 1999 isj (Banking) 656 : (AIR 1999 SC 1305), it has been asserted that time-barred dues cannot be recovered and In the case of recovery limitation period is three years. It has also been averred that before issuance of recovery certificate no opportunity of personal hearing has,been granted, which violates the principles of natural justice. In that regard, reliance has been placed on the judgment of Hon'ble the Supreme Court in the case of S. K. Bhargava v. Collector, chandigarh, (1998) 5 SCC 170 : (AIR 1998 sc 2885 ).

(3.) FURTHER case of the petitioners is that the respondent-Corporation has not framed any rules and procedure as per Section 47 of the Act and, thus, it cannot issue recovery certificate under Section 32-G of the Act. A Notification dated 1-11-2005 (P-3), issued by the State Government appointing the managing Director of the respondent-Corporation to be the authority for the purpose of Section 32-G of the Act has also been impugned in the instant petition on the ground that the same is not sustainable because the person who is appointed as a Authority is the Managing Director of the respondentcorporation and is an interested person and issued the recovery certificate for recovery of the amount.