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2013 DIGILAW 191 (JK)

Farida Hotel v. State Of J&K

2013-04-08

MUZAFFAR HUSSAIN ATTAR

body2013
1. The petitioner-hotelier in order to make addition to his existing hotel structure approached the Jammu and Kashmir State Finance Corporation (for short the `Corporation') a creation of State Financial Corporation Act, for grant of financial assistance. The financial assistance in the amount of Rs. 13.00 lacs was sanctioned in his favour vide communication no. HO/Appr/2000/363 dated 3rd May, 2000. 2. The respondent-Corporation issued notice dated 10th December, 2010 to the petitioner wherein he was informed that the Board of Directors of the Corporation after approving the recommendations of Default Review Committee (DRC) for waiving off penal interest of Rs. 12,50,376.00 and 25% compound interest of Rs. 3,29,675.00 total 15,80,051.00 ordered that the petitioner to deposit an amount of Rs.35,65,260.00 representing the principal amount, simple interest and compound interest. The petitioner was directed to repay the said amount within 60 days or in alternative within six months with simple interest @ 12% per annum on diminishing principal basis from the date of issuance of the said letter. It was also informed that if the concession was not availed, then the proceedings in accordance with law will be initiated against the petitioner for recovery of the entire dues. The petitioner was also informed that in case he does not avail the said concession then the benefits granted shall be withdrawn without any notice and proceedings in accordance with law will be initiated for recovery of the entire dues. 3. Feeling aggrieved of the said communication, petitioner has challenged the same in this writ petition. Petitioner has further prayed that by Writ of Certiorari the cut off date 31st December, 1999 as fixed in the Amnesty policy be quashed as being arbitrary and violative of principle of natural justice. It is further prayed in the writ petition that respondents be directed to extend the benefits of the Amnesty scheme/exit policy to the petitioner also. 4. On notice, respondents filed objections and thereafter in terms of Court order, filed supplementary affidavit. The petitioner has filed response to the supplementary affidavit. 5. Learned counsel for the petitioner submitted that the cut off date fixed as 31st December, 1999 in respect of Amnesty scheme/exit policy being arbitrary requires to be quashed, so as to enable the petitioner to get benefit which flows from the said Amnesty scheme/exit policy. The petitioner has filed response to the supplementary affidavit. 5. Learned counsel for the petitioner submitted that the cut off date fixed as 31st December, 1999 in respect of Amnesty scheme/exit policy being arbitrary requires to be quashed, so as to enable the petitioner to get benefit which flows from the said Amnesty scheme/exit policy. Learned counsel referred to paragraph 12 of the writ petition and submitted that respondents have given benefits of the said policy beyond the cut off date to M/s Star Hotel Batote and settlement was arrived at with the said hotelier in the year 2004 much after the cut off date as fixed in the Amnesty scheme/exit policy. 6. Learned counsel also referred to the response filed to the supplementary affidavit to indicate that respondents in the years 2005 and 2006 settled like issues, but the petitioner has been subjected to invidious discrimination, notwithstanding this fact that petitioner had sought similar treatment, which has been given to the aforesaid person. Learned counsel in support of the contentions referred to and relied upon the judgment of Hon'ble the Supreme Court in case titled `Mahesh Chandra v. Regional Manager, U. P. Financial Corporation and others', reported in AIR 1993 Supreme Court 935. Learned counsel for the petitioner prayed for allowing the writ petition. 7. Learned Advocate General appearing for the Corporation submitted that the petitioner sought financial assistance much after the cut off date fixed in the Amnesty scheme/exit policy of the Government as 31st December, 1999. Learned counsel further submitted that the petitioner would not be entitled to any benefit of the Amnesty scheme/exit policy for which date was extended up to 31st December, 1999 for the simple reason that the financial assistance was sought and provided to him much after the said cut off date. 8. Learned Advocate General also referred to supplementary affidavit filed by the Corporation and submitted that the stand taken by the petitioner at paragraph no. 12 of the writ petition has been sufficiently explained, inasmuch as, M/s Star Hotel Batote had sought the benefit of the Amnesty scheme/exit policy in accord with the said scheme. Learned counsel further referred to the supplementary affidavit and Stated that the financial assistance/loan to the amount of Rs. 14.42 lacs was sanctioned in favour of the M/s Star Hotel, Batote on 23rd March, 1988 and the amount of Rs. Learned counsel further referred to the supplementary affidavit and Stated that the financial assistance/loan to the amount of Rs. 14.42 lacs was sanctioned in favour of the M/s Star Hotel, Batote on 23rd March, 1988 and the amount of Rs. 7.00 lacs was only disbursed in favour of the said loanee. Learned counsel further stated that the said loanee could not make the Hotel Star operational because of militancy which affected the area in the year 1989-90 and that the status of the unit from the date of issuance of scheme of being "non functional" for this reason, his case was settled on 14th July, 2004 on its own merit and not on basis of the Amnesty scheme as the Hotel was not in existence or functional at the time of issuance of Amnesty scheme. Learned counsel while referring to the pleadings of the supplementary affidavit submitted that on the decision of the Board of Directors of the Corporation, the said loanee was asked to pay the basic amount with simple interest within stipulated time frame. Learned counsel also referred to the pleadings of the supplementary affidavit to indicate that in the case of the petitioner an amount of Rs. 13.00 lacs was sanctioned as loan on 3rd May, 2000 and Rs. 12.73 lacs were disbursed upto 28th April, 2003. The petitioner completed the hotel construction in the year 2003-04 and the hotel was functional and never remained closed. The hotel premise was occupied by the Government Degree College, Chatroo and also the Sheep Husbandry Department. It is also pleaded in the supplementary affidavit that the Board of the Corporation taking lenient view granted concession to the petitioner and made an agreed settlement with him and waived off the compound and penal interest and the petitioner was to pay the balance amount of Rs. 35.00 lacs in lump sum without any interest within 60 days or with simple interest @ 12% per annum within six months. Learned counsel also stated that the outstanding at the time of filing of supplementary affidavit against the petitioner was Rs.94.60 lacs and submitted that petitioner has not paid even a single installment for discharging the debt. It is also pleaded that the Assistant Commissioner Kishtwar (Collector) has passed award in favour of the petitioner for an amount of Rs. 60.34 lacs out of which Rs. It is also pleaded that the Assistant Commissioner Kishtwar (Collector) has passed award in favour of the petitioner for an amount of Rs. 60.34 lacs out of which Rs. 40.00 lacs have been received by him and balance amount has been deposited with the Registrar Judicial of this court in terms of the order passed in this writ petition. 9. Learned counsel submitted that this petition deserves to be dismissed. In support of his contention, learned counsel referred to and relied upon the case titled "Haryana Financial Corporation and another v. Jagdamba Oil Mills and another", reported in (2002) 3 Supreme Court Cases 496 and case titled "M/s Micro Hotel P. Ltd. v. M/s Hotel Torrento Ltd. and Ors." reported in AIR 2012 Supreme Court 3291. 10. The Corporation is financial institution created and devised to provide financial assistance to such entrepreneurs/businessmen and those interested in creating avenues for earning their livelihood. The Corporation acts as trust of the public money. The money which is paid to any person/ agency out of the funds of the Corporation is to enable such person/agency to generate income for himself and for those who work with him. The person/agency who become beneficiaries of the Corporation money is duty bond to repay the same in the manner agreed between the parties, so as to enable the Corporation to extend like benefits to like persons/agencies. 11. The situation may arise, where for the unforeseen reasons, a person/agency may be disabled to either utilize the money in the manner same was required to be utilized or for the reason beyond his control the business may not take off. The Corporation in such circumstances has to take proper decision so as to ameliorate the lot of such class of loanees. 12. In the year 1989-90 the State of Jammu and Kashmir was ushered into abnormal circumstances, which adversely affected almost every walk of life. At request of the affected parties, the Corporation in its own wisdom decided to provide relief to those loanees whose business establishments came to a grinding halt. The Amnesty scheme/exit policy was framed and the Corporation in its wisdom extended its operational date upto 31st December, 1999. Scheme provided the procedure for seeking benefits thereunder. 13. At request of the affected parties, the Corporation in its own wisdom decided to provide relief to those loanees whose business establishments came to a grinding halt. The Amnesty scheme/exit policy was framed and the Corporation in its wisdom extended its operational date upto 31st December, 1999. Scheme provided the procedure for seeking benefits thereunder. 13. The benefit of the scheme /exit policy was made applicable to all such units which remained closed right from the beginning i.e units (SSI units & Hotels)/left un-implemented/ left half way and the established units which did not go into production for the reasons mentioned in paragraph 2 of the scheme. 14. The petitioner sought financial assistance from the Corporation years after the scheme had come to an end and strongly prays to quash the cut off date. In the aforesaid factual background, it is not possible to agree with the pleadings in the writ petition, as from a non existent policy, no benefit can be sought. Even otherwise, extending benefits upto particular date falls within the domain of the policy makers of the Corporation. While fixing the cut off date, the executive takes into consideration many aspects. The Constitutional Courts, however, are not preventive from reviewing such decision, but for that extra-ordinary case has to be made out by the petitioner. In this case, as already stated the petitioner is seeking extension of benefits of this scheme/ Amnesty scheme which did not exist at the time he applied for grant of financial assistance. The relief sought for cannot also be granted for the reasons that the Corporation considered the case of M/s Star Hotel and waived off the penal and compound interest, but directed to pay the simple interest and like decision, was taken in the case of the petitioner in terms of the impugned communication dated 12th October, 2010, but petitioner instead of availing the said benefits, challenged the said decision in this writ petition. The contention of the learned counsel for the petitioner that the petitioner was similarly circumstanced with the M/s Star Hotel, Batote but discriminated, cannot be accepted for the reason that the similar treatment has been made out to the M/s Star Hotel and the petitioner, but the petitioner still did not accept the said decision and secondly the facts in the case of the M/s Star Hotel and the petitioner's case are materially different, inasmuch as, M/s Star Hotel had sought the financial assistance way back in the year 1988 and thereafter Amnesty scheme came into existence, whereas the petitioner sought and was granted the financial assistance much after Amnesty scheme/exit policy had come to an end. The reliance placed on the order of the Division Bench in LPA (OW) no. 09/2005 dated 11th April, 2005 is as no help to the petitioner, inasmuch as, it is the order passed on the agreement of the parties. The judgment in `Mahesh Chandra' case cited at bar would show that the Corporation is not profit earning body would also be of no assistance. This judgment of Hon'ble the Supreme Court proceeds on its own facts and is different from the recovery case of the petitioner. 15. For the above said discussion, this petition is dismissed. 16. Registry is directed to release the aforesaid amount alongwith interest in favour of the respondent-Corporation after one week from today.