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Judgment
Heard Mr Godinho, learned counsel who appears under the Legal Aid Scheme on behalf of the petitioner and Ms Susan Linhares, learned Additional Government Advocate for the first respondent.
Mr Prakash Chitari, the second respondent was the surety for repayment of the loan obtained in the year 1989, though served is not present. In any event, for the order which is proposed to be made, his presence is strictly speaking not necessary.
The Petitioner challenges the judgment and order dated 28.06.2011 in case No.113/37/97-DRO passed by the Deputy Collector and D.R.O., South Goa District, Margao Goa, under the provisions of Goa Public Money (Recovery & Dues) Act, 1986 (the said Act).
The petitioner had obtained a loan of Rs.65,000/- from the first respondent for setting up a small carpentry unit.
In 1997, on the ground of default, the first respondent initiated recovery proceedings by instituting Case No.113/37/97-DRO against the petitioner, by invoking the provisions of the said Act. A show cause notice dated 09.07.2007 was issued to the petitioner. The petitioner objected inter alia on the ground that the proceedings were time barred. The petitioner also pointed out how in similar circumstances, loans were waived by the first respondent. Without prejudice, the petitioner submitted that he would pay the principal amount but at least interest should be waived.
Mr Godinho submitted that the DRO, by the impugned order dated 28.06.2011, without considering the petitioner’s defences, directed the petitioner to pay the entire principal amount with simple interest within three months failing which action under Section 123 of the Land Revenue Code was threatened against the petitioner.
Mr Godinho reiterated the contentions raised in reply to the show cause notice issued to the petitioner. He submitted that the petitioner was a poor person and despite all the financial problems, was agreeable to pay the principal amount of Rs.65,000/- even now without prejudice to the contentions about the bar of limitation and the discrimination practiced against him. He submitted that he even persuaded the petitioner to pay some additional amount considering the timelines.
Mr Godinho submitted that otherwise the proceedings were hopelessly time barred. He pointed out that the limitation period would apply in the proceedings under the said Act and even assuming that the Limitation Act was not applicable, the action had to be initiated within a reasonable period. He submitted that there was no answer to the charge of discrimination levelled against the petitioner.
Ms Linhares submitted that there was no dispute about the petitioner had taken a loan in 1989 and defaulted in its payment. She submitted that the interest at the contractual rate was demanded and there was no reason why that should not have been ordered to be paid by the petitioner. She submitted that no limitation period is prescribed and in any event, action was taken after the petitioner, despite notice, refused to make any payments. Accordingly, she submitted that the proceedings were not barred by limitation, delay or laches.
Ms Linhares submitted that the charges of any alleged discrimination were never substantiated. He submitted that based upon such allegations, the petitioner cannot avoid repayment of admitted dues. Ms Linhares pointed out that the petitioner had agreed to make the payment and this is recorded in the letter dated 30.03.2007 and roznamas dated 04.07.2008 and 29.08.2008.
For the above reasons, Ms Linhares submitted that there was no case for interfering with the DRO's order. She submitted that this petition may therefore by dismissed.
The rival contentions now fall for determination.
In this case, it is true as was contended by Ms Linhares that the petitioner had obtained a loan from the first respondent to set up a small carpentry unit. Even default to be said to have been admitted. However, from the material on record, it is difficult to conclude that the petitioner was some wilful defaulter interested in dodging the loan payments even though he had a capacity and means to pay the same.
Again, as was pointed out by Ms Linhares on behalf of the first respondent, by letters of 2007 and the roznama entries, it is evident that the petitioner had offered to repay the loan amount. The petitioner was only pleading for waiver of interest and other charges. Even at that stage itself the first respondent had considered the petitioner's case reasonably, the matter in all probabilities could have been over.
The petitioner had given instances of similar cases where the first respondent had waived the entire loan amount or in any case, granted concessions when it came to interest payment. There was no explanation from the first respondent as to why the same course of action was not adopted in case of petitioner.
Be that as it may, some decision should have been taken by the first respondent on accepting the principal amount of Rs.65,000/- that was offered by the petitioner in 2007-2008. In this case, while it is necessary to go into the issue of whether any limitation period applies to the proceedings under the said Act, the petitioner cannot be unduly prejudiced on account of delayed action on the part of the first respondent. At least the interest should have been waived and the matter closed after the petitioner offered to pay the principal amount.
The DRO has not considered most of the contentions raised by the petitioner. The DRO has only held that if every defaulter tries to take shelter of limitation period, it will be difficult for the financial institutions to run. The DRO has also held that if the entire loan amount is waived then it will serve as a precedent that would be relied upon by the other defaulters and the first respondent would run into loss.
However, the DRO has failed to consider the precedents that the petitioner was referring to where the entire loan amount had in fact been waived by the first respondent. The DRO has also failed to note that the petitioner was never seeking a waiver of the entire loan amount but only a waiver of the interest amount, and that too because of a reduced financial capacity, coupled with the delay of almost 9 years since initiating proceedings against him.
For the above reasons, and for non-consideration of the crucial issues that arose in this matter, the petitioner has made out a case for quashing the DRO’s order of 28.06.2011. However, quashing would entail only remand to the DRO for reconsideration. At this point in time, a remand would serve the interests of neither party.
Therefore, Mr Godinho was requested to obtain instructions from the petitioner as to whether the petitioner, in addition to the principal amount of Rs.65,000/- would pay some further amount to the first respondent.
The first petitioner Mr Pramod Poly D’Silva is present in the Court. He has instructed Mr Godinho to submit that he will pay an amount of Rs. 1,00,000/- to the first respondent in full and final settlement of the loan amount. To show his bona fides, he has come to this Court with a Demand Draft of Rs. 1,00,000/- issued by the Bank of Maharashtra and drawn on the Registrar of this Court for an amount of Rs. 1,00,000/-.
Considering the peculiar circumstances of the present case, rather than remanding the matter, the interest of justice would be best served if the petitioner is permitted to deposit the amount of Rs.1,00,000/- in this Court and the first respondent is allowed to withdraw the same unconditionally but in full and final settlement of the petitioner's loan account.
Ultimately, this Court cannot ignore that the petitioner had sought and was granted a loan of Rs. 20,000/- towards working capital, a loan for machinery of Rs. 30,000/- and a loan for katcha structure of Rs. 15,000/-. The petitioner was struggling to put up a carpentry unit through the katcha structure.
Mr Godinho states that the petitioner has already repaid Rs. 10,000/-to the petitioner. Therefore, this was not a case of a wilful defaulter dodging payment despite having the means to pay. The petitioner was struggling to set up a carpentry unit and survived on its income. Even before this Court, the petitioner had to avail of Mr Godinho's services under the Legal Aid Scheme.
Therefore, this petition is disposed of by allowing the petitioner to deposit Rs.1,00,000/- in this Court. Upon such deposit, the first respondent is permitted to withdraw the deposited amount in full and final settlement of the petitioner's claim against the loan account, which is the subject matter of the sanctioned letter dated 21.02.1989 and this petition.
Upon withdrawal of this amount of Rs. 1,00,000/-, or if such amount is not withdrawn within four weeks, the first respondent shall issue a no due certificate to the petitioner. Such a certificate should be issued within four weeks of the withdrawal of this amount. If no such certificate is issued within four weeks, then the same shall be deemed to have been issued, and the first respondent shall not raise any further demand from the petitioner regarding this loan account.
This Court records the efforts made by Mr Godinho, who appeared on behalf of the Petitioner under the Legal Aid Scheme. This Court also appreciates Pramod Poly D'Silva's reasonable approach in this matter and coming to the Court with a demand draft of Rs. 1,00,000/-, which could be ultimately paid to the first respondent.
The Goa State Legal Services Authority must pay Mr Godinho's fees in terms of the rules as expeditiously as possible. This is, in addition to this Court's gratitude to him for appearing in this matter.
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