K.C. Ali Haji vs. District Collector

WP(C)/2547/2023HC KeralaGSTCNR KLHC01006249202331 January 2023Bench: HONOURABLE MR. JUSTICE SHAJI P.CHALY12 pages
AI SummaryPartly Allowed

Held

The Court held that the demand for 7.5% collection charges was unsustainable as the petitioner had settled the loan directly. However, it affirmed the liability to pay 1% service charges under Rule 5(3) of the Kerala Revenue Recovery Rules, 1968, since the payment was made after the initiation of recovery action. The demand for 7.5% collection charges was quashed.

Facts

The petitioner defaulted on a loan from Kerala Financial Corporation (KFC), leading to revenue recovery proceedings and property attachment. He subsequently settled the loan directly with KFC in an adalath. After settlement, KFC demanded 7.5% collection charges, 1% service charges, and 18% GST on the collection charges.

Key Issues

The key legal issue was whether the Kerala Financial Corporation could levy 7.5% collection charges when the loan was settled directly by the defaulter after revenue recovery proceedings were initiated, and if 1% service charges were applicable under such circumstances.

Sections Cited

Rule 4(viii) of Kerala Revenue Recovery Rules, 1968, Rule 5(1) of Kerala Revenue Recovery Rules, 1968, Rule 5(2) of Kerala Revenue Recovery Rules, 1968, Rule 5(3) of Kerala Revenue Recovery Rules, 1968, Section 69(3) of Kerala Revenue Recovery Act, 1968

AI-generated summary — verify with the full judgment below

: 1 : IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT THE HONOURABLE MR. JUSTICE SHAJI P.CHALY TUESDAY, THE 31ST DAY OF JANUARY 2023 / 11TH MAGHA, 1944 WP(C) NO. 2547 OF 2023 PETITIONER/S: K.C. ALI HAJI AGED 62 YEARS S/O AMMED HAJI, K.C. HOUSE KUNHOM POST, WAYANAD DISTRICT PIN-670 731. BY ADVS. P.I.DAVIS RAJAN VELLOTH RESPONDENT/S: 1 DISTRICT COLLECTOR COLLECTORATE WAYANAD, NORTH KALPETTA P.O WAYANAD PIN-673 020. 2 THE DEPUTY TAHASILDAR (RR) KERALA FINANCIAL CORPORATION MUTHALAKULAM, GH ROAD, KOZHIKODE- 673 001. 3 CHIEF MANAGER KERALA FINANCIAL CORPORATION 1ST FLOOR, TRIDENT ARCADE PINANGODE ROAD, KALPETTA, WAYANAD-673 121. BY ADVS. ADV. VENUGOPAL.M.R DHANYA P.ASHOKAN(K/001671/2000) S. MUHAMMAD ALIKHAN(K/000644/2020) SMT. DEEPA N., GOVERNMENT PLEADER THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 31.01.2023, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:

: 2 : ‘C.R’ SHAJI P. CHALY, J. --------------------------------------------------------- W.P.(C). No. 2547 of 2023

--------------------------------------------------------- Dated this the 31st day of January, 2023.

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