JUDGMENT : K.M. Josesph, C.J. (Oral) Appellant is the writ petitioner. Appellant is a Company, which had taken a contract for collection of entry fee in the city of Nainital at two points. According to the appellant, during the continuance of the contract, certain disputes arose. In terms of the arbitration clause, the District Magistrate was appointed by Annexure No. 3 order. At the time when the writ petition was filed, it appears that there was no award. Appellant submitted Annexure No. 4 claim before the Arbitrator, which is alleged to be pending in the writ petition. While so, recovery proceedings were taken for an amount of ‘ 14,88,500/- together with recovery charges. Appellant moved an Application under Section 9 of the Arbitration and Conciliation Act, 1996 (Annexure No. 7). Objections were filed to the same and the same was rejected by Annexure No. 9 Order. Annexure No. 10 is the appeal carried before this court. The same was rejected by order dated 22.02.2011 (Annexure No. 11). Thereafter, appellant approached this Court by filing the writ petition seeking to quash the recovery notice dated 18.05.2010 and the letter dated 22.05.2010 of respondent No. 3 forwarding the same to the Deputy Commissioner. 2. The learned Single Judge found favour with the contention of the appellant that the respondent Municipal Board is not a notified corporation under the U.P. Public Moneys Recovery of Dues Act, 1972 (hereinafter referred to as the “Act”); but, noted that there is no equity in favour of the appellant, inasmuch as, the amounts sought to be recovered are amounts, which are not in dispute. The learned Single Judge, placing reliance on the judgment of a Bench of the Allahabad High Court in Rakesh Shukla vs. District Magistrate/SDM, Phulpur, Allahabad, reported in 2002(2) UPLBEC 1939 , dismissed the writ petition. Feeling aggrieved, appellant is before us. 3. We have heard Mr. Sudhir Kumar, learned counsel appearing for the appellant; Mr. D.S. Patni, learned counsel appearing on behalf of respondent Nos. 1 & 2 Municipal Board; and Ms. Anjali Bhargava, learned Brief Holder appearing for the State. 4. Learned counsel for the appellant would submit that the proceedings taken under Section 9 culminated in their being rejected on the basis that the amounts sought to be recovered by the recovery proceedings were not subject matter of the arbitration proceedings. 1 & 2 Municipal Board; and Ms. Anjali Bhargava, learned Brief Holder appearing for the State. 4. Learned counsel for the appellant would submit that the proceedings taken under Section 9 culminated in their being rejected on the basis that the amounts sought to be recovered by the recovery proceedings were not subject matter of the arbitration proceedings. He would also point out that, in fact, in the judgment in Iqbal Naseer Usmani vs. Central Bank of India and others, reported in (2006) 2 SCC 241 , which was in fact referred to by the learned Single Judge, there are observations, which should conclude the issue at hand. He drew our attention to paragraph 7 of the said judgment, which reads as follows: “7. Upon a perusal of the record, and after hearing learned counsel, we are not satisfied that the case of the appellant falls within the parameters of Section 3 of the Act. Consequently, the Revenue Officers have neither the authority to issue any certificate for recovery, nor the power to take any steps for recovery of the decretal amount. The High Court seems to have been impressed by the fact that the money was public money, and that in order to encourage development in the country, banks are providing loan facilities to persons who are willing to purchase vehicles and further that if such a loan is treated as a commercial loan, it would be difficult for the bank to recover the same by filing a civil suit, which takes years and years to decide. According to the High Court “the money of the bank and financial institutions is public money, which should be in circulation, otherwise the bank and depositors will suffer”. We are afraid that while this may be very good sentiment, it cannot apply in the face of Section 3 of the Act for the reason that Section 3 does not envisage the provisions of the Act being utilized for recovery of every loan taken. Section 3(1)(b) permits this to be done only in respect of loans taken under a “State-sponsored scheme”, which expression has been defined in Section 2(g) of the Act. Section 3(1)(b) permits this to be done only in respect of loans taken under a “State-sponsored scheme”, which expression has been defined in Section 2(g) of the Act. Since it is admitted that the loan taken by the appellant was not under or in relation to a “State-sponsored scheme” within the meaning of Section 2(g), whatever else it may be, it would not be recoverable by recourse to the machinery under Section 3 of the Act.” 5. He would, in fact, submit that the case of the appellant is on a better footing, inasmuch as, the case before the Hon’ble Apex Court involved a money decree and, still, the Hon’ble Apex Court made the observations as it did in paragraph 7. He would, therefore, submit that, while there might be sentiment about amounts being admittedly due, it cannot overwhelm the issue relating to legality of the procedure adopted. He would, further, submit that there is an Award passed by the Arbitrator, which is in challenge before the District Court and the Municipal Board is not remedy-less. 6. Per contra, Mr. D.S. Patni, learned counsel appearing for the Municipal Board, submitted that the appellant had approached the authority under Section 9 and the order of rejection was affirmed by this Court and, in the writ petition also, there is no dispute regarding the amount payable as licence fee and the amount before the Arbitrator relates to the claim for damages for which the arbitration clause was invoked by the appellant. It is, therefore, submitted that, in view of the fact that there is no equity in favour of the appellant, the judgment of the learned Single Judge is to be supported. Learned Brief Holder appearing for the State would also adopt the said submissions. Mr. D.S. Patni would, in fact, submit that, if the Court is not inclined to accept the contentions and is inclined to grant relief to the appellant, it may be left open to the Municipal Board to recover the amounts as per law. 7. It is true that Article 226 is the reservoir of extra-ordinary power, inasmuch as, the limitations, which the courts have come to recognise over a period of time, are all self-imposed limitations. It could be said that there is virtually very little limit over power under Article 226, except those, which have evolved over a period of time with decisions of the courts. It could be said that there is virtually very little limit over power under Article 226, except those, which have evolved over a period of time with decisions of the courts. As much as the power is seemingly without limit, the courts have recognised that it is always a discretionary power. The concept of discretionary power is particularly pertinent in the context of the exacting standards, which the court expects of a writ applicant in the matter of conduct, be it in the matter of not suppressing material facts or his conduct otherwise. 8. In this case, no doubt, the appellant entered into a contract, under which, appellant is obliged to pay a licence fee. There is a case for the appellant that the appellant was hindered from collecting fee and a claim for damages was raised before the Arbitrator and the Award, no doubt, went against the appellant. It is challenged. We say no more there, as the matter is pending before the competent court. When the appellant was faced with recovery initiated under the Act, appellant initially moved an Application under Section 9. That came to be rejected on the score that the subject matter of the recovery is not covered in proceedings in arbitration. This view was shared by this Court in appeal. However, we notice that, while affirming the judgment of the District Court, appellant was left free to take recourse to other forums as the appellant may be advised. Therefore, we cannot possibly throw-out the claim on the ground of res judicata as such. 9. Then, we come to the meat of the matter, which is whether, in the light of the appellant having incurred contractual dues as contended by the learned counsel for the Municipal Board, can he be told off the gates for sheer reason that, undisputedly, he has committed breach of the contract and the amounts were due from him and the recovery is only to recover the said amounts. Appellant is before this Court questioning the modus adopted by the respondents in invoking the Act. The learned Single Judge has, in fact, come to the conclusion that the respondent Municipal Board is not a notified corporation; yet, recovery is sought to be made under the Act; and this is, per se, illegal and unauthorised. Appellant is before this Court questioning the modus adopted by the respondents in invoking the Act. The learned Single Judge has, in fact, come to the conclusion that the respondent Municipal Board is not a notified corporation; yet, recovery is sought to be made under the Act; and this is, per se, illegal and unauthorised. We have already noticed the observations of the Hon’ble Apex Court in paragraph 7 extracted above and, that too, in a case, where, when one reads paragraph 4, it is made quite clear that the appellant therein did not wish to impugn the decree against him and, therefore, the decree had become final and, therefore, it must be taken to be a case, where the amounts could be said to be clearly due and, yet, the court sustained his challenge to the proceedings unauthorised as it turned out to be. Equally de hors the Act and illegally have the respondents invoked the provisions of the Act. 10. In the light of the judgment of the Hon’ble Apex Court, which we have relied on, we would think that the learned Single Judge was in error in drawing support from the judgment of a Bench of the Allahabad High Court. 11. In such circumstances, we would think that the appellant is entitled to the relief. Consequently, the appeal is allowed; the judgment passed by the learned Single Judge is set aside; the writ petition will stand allowed; and the impugned proceedings will stand quashed. However, we hasten to add that this will be without prejudice to the rights of the Municipal Board to recover the amounts due from the appellant as per law. No order as to costs.