Sh. Krishan Dayal vs Himachal Pradesh State Financial Corporation and Others

Dev Darshan Sud, J.—The Petitioner is aggrieved by the action of the Financial Corporation in ordering recovery of the dues purportedly outstanding from him. The recovery was sought to be effected under the provisions of HP Public Moneys (Recovery of Dues) Act, 1982. The grievance of the Petitioner is that he was not given a chance of being heard by the Managing Director of the Himachal Pradesh Financial Corporation before issuing the recovery certificate and the Principles of Natural Justice have been violated.

From the pleadings, I find that there is no compliance with the Principles of Natural Justice before issuance of the recovery certificate. This Court in Raj Kumar v. Himachal Pradesh Financial Corporation and Ors. Latest HLJ 2005 (1) 501 following the decision of the Supreme Court in AIR 2003 SC 2103 has held that no recovery can be effected without first complying with the provisions of Natural Justice i.e. giving an opportunity to the person affected, of being heard and to put forth his case.

The second contention raised by the learned Counsel appearing for the Petitioner is that recourse could not be had by the Financial Commissioner for recovery of dues under the H.P. Public Moneys (Recover of Dues) Act, 1982. For this, he places reliance on two judgments referred to above, which hold that recovery can only be made under the Recovery of Debts Due to Banks and Financial Institutions Act, 1993. Learned Counsel Mr. Ajay Sharma contended that the Act is not applicable to the facts in the present case as the amount is below Rs. 10,00,000/-

This point does not require any adjudication for the reason that according to reply filed by the Financial Corporation, the amount due is Rs. 19,69,194/- on account of term loan and Rs. 3,99,481/- on account of soft loan. Thus in all an amount of Rs. 23,68,675/- is claimed by the Financial Corporation. If that be so, it is but obvious that two decisions referred to above would apply. This Writ Petition is accordingly allowed. The Annexure P-2 is quashed and set aside. This would not preclude the Financial Corporation from recovering the amount due from the Petitioner in accordance with law. Writ Petition is disposed of. No orders as to costs.