LexSTATE OF KERALA AND ORS. versus V.R. KALLIYANIKUTTY AND ANR. ETC. ETC.
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A B STATE OF KERALA AND ORS. v. V.R. KALLIY ANIKUTTY AND ANR. ETC. ETC. APRIL I, 1999 [MRS. SUJATA V. MANOHAR, D.P. MOHAPATRA AND R.C. LAHOTI, JJ.] Kera/a Revenue Recovery Act, 1968-Ss. 71, 70 (2)(3) and 69(2)-Time \ barred debts-Recovery of-Notification-Provisions of Act made applicable C \to recove1y of loans by Bank or Kera/a Financial Corporation-Whether debts barred by limitation can be recovered by restoring to proceedings under the Act? Heid, no, the Act does not create any new right and it merely provides a process for speedy recovery in public interest-Thus, time barred debts which are not legally recoverable cannot be recovered under the Act. D Words & Phrases "Amo11nt due "-Meaning of in the context of sec. 71 of Kera/a Revenue Recovery Act, 1968. In exercise of its powers under sec. 71 of Kerala Revenue recovery E Act, 1968, Sta~e Government issued a notification by which the provisions of the said Act were J!1ade applicable to the recovery of amounts due. from any person by any Bank or Kerala Financial Corporation. A question of law arose whether debt barred by limitation Act can be recovered by restoring to recovery proceedings under the act. A Division Bench of High Court held F that in the absence of any provision in the, Act creating a substantive right to recover time barred debts, debts barred under limitation Act cannot be. recovered. However, the said judgment was overruled by a Full Bench of High Court. Hence the present appeals. G Disposing of the matter, this Court HELD : 1. Under sec. 71 of the Kerala Revenue Recovery Act, 1968 claims which are not legally recoverable and are time barred on the date of requisition under sec. 69 (2) of the Act are not "amounts due" and cannot be recovered under the said Act. (381-H; 382-A) H 2. The Act does not create any new right. It merely provides a process 372 - - - > ! STATEv. V.R. KALLIYANIKUTTY 373 for speedy recovery of moneys due. Therefore, instead of filing a suit, A obtaining a decree and executing it, the bank or the financial institution can now recover the claim under the Act. Since the Act does not create any new right , the person claiming recovery cannot claim recovery of amount which are not legally recoverable nor can a defence of limitation available to a debtor in a suit or other legal proceeding be taken away under the provisions B of the Act. Although the necessity of filing a suit by a creditor is avoided, the extent of claim which is legally recoverable is not thereby enlarged. [378-A-B; 381-BJ The Director of Industries, U.P. & Ors. v. Deep Chand Agarwal, AIR (1980) SC 801; Hansraj Gupta & Ors. v. Dehradun-Mussoorie C Electric Tramway co, Ltd., AIR (1933) PC 63 and New Delhi Municipal Committee v. Kalu Ram & Anr., [1976) 3 SCC 407, relied on. Khadi Gram Udyog Trust v. Ram Chndraji Virajman Mandir, Sarasiya Ghat, Kanpur, [1978) (1) SCC 44 and Punjab National Bank & Ors. v. Surendra Prassad Sinha, [1993) supp. 1 SCC 499, held inapplicable. D 3. An "amount due" normally refers to an amount which the creditor has a right to recover. " Amount due" under sec. 71 of the Act are those which the creditor could have recovered had he filed a suit. (377-A-B; 381-GJ E Wharton's Roman Law Lexicon; Black's Law Dictionary, 6th Edn. at page 499, referred to. 4. Under sec. 70 (3) a person who has paid under protest can file a suit for refund of the amount wrongly recovered. In law he would be entitled to F submit in the suit that the claim against which the recovery has been made is time-barred. Hence no amount should have been recovered from him. When the right to file a suit under section 70 (3) is expressly preserved , there is a necessary implication that the shield of limitation available to a debtor in a suit is also preserved. He cannot, therefore, be deprived of this G right simply by making a recovery under the said Act unless there is anything in the Act which expressly brings about such a result. Provisions of the said Act. However, indicate to the contrary. Moreover, such a wide interpretation of "amc.unt due" which destroys an important defence available to a debtor in a suit against him by the creditor, may attract Article 14 against the Act. It would be ironical if an Act for speedy recovery is held H 374 SUPREME COURT REPORTS [1999) 2 S.C.R. A as enabling a creditor who has delayed recovery beyond the period oflimitation to recover such delayed claims.
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