NAND RAM Vs. STATE OF RAJASTHAN

JUDGEMENT

(1.) THE instant writ petition has been filed challenging the proceedings initiated vide notice dt. 21.07.2004 (Annex. 4) by respondents No. 1 and 2 and further prayed that recovery certificate dt. 24.12.2003 may also be quashed with all consequential benefits.

(2.) AS per facts, inter alia, stated in the petition, a loan of Rs. 2,10,000/ - was granted by respondent No. 3 to the petitioner on 16.02.1990. It is submitted that some amount was paid by the petitioner; but, due to fluctuation in the market and dire need of financial assistance which was not made available to the petitioner, the petitioner could not run the small unit and was burdened with heavy losses. It is submitted that at the time of grant of loan certain documents were executed in between the parties such as, loan agreement, letter of hypothecation of tangible movable property, trust letter, affidavit and guarantor deed etc. It is submitted that respondent No. 3 initiated proceedings to recover the outstanding under the provisions of State Financial Corporation Act, 1951 (hereinafter, 'the Act of 1951') against the petitioner and assets of the petitioner were sold by enforcing provisions of Section 29 of the Act of 1951 and as a result of that respondent No. 3 received a sum of Rs. 1,54,000/ - by recourse to auction sale. The said sale was finalized on 18.03.2003. It is admitted that the petitioner did not make any objection at the relevant time.

(3.) IT is contended that respondent No. 3 committed material irregularity and arbitrariness while carrying through the auction proceedings dt. 18.03.1999 and caused irreparable injury to the petitioner. It is contended that it is established law which makes it clear that a party who had right to get and receive outstanding payable amount from any party then such party cannot receive amount by adopting legal recourse within the specified limitation of three years from the last acknowledgment in pursuance of the related subject matter. It is argued that despite knowing the legal aspect the respondent No. 3 issued a certificate for recovery on 24.12.2003 and, in consequence thereof, respondent No. 2 issued a notice under Section 229 of the Rajasthan Land Revenue Act, 1956, recovering the alleged money under the provisions of Sections 256 and 227 of the Rajasthan Land Revenue Act which is altogether unauthorized and without jurisdiction.