- (1.) PALOK Basu, J. The only controver sy involved in the bunch of these writ peti tions is whether on the recovery proceed ings initiated against the petitioners at the instance of concerned respondent recourse could be taken to the provisions contained in Uttar Pradesh Public Moneys (Recovery of Dues) Act, 1972 (for short Recovery Act ).
(2.) M/s. Rewa Gases Private Limited have prayed that recovery certificate dated 6-10-1990 (Annexure 17 to the writ peti tion), M/s. Vikas Industrial Gases Limited have prayed that Citation No. 132803 dated 21-8-1991 (Annexure 9 to the writ petition) and M/s. Vindhyachal Air Products Private Limited have prayed that recovery certificate dated 6-11-1996 (An nexure 18 to the writ petition) may be quashed. In these documents substantial amount is sought to be recovered against the three petitioners respectively for the alleged price of the materials supplied by the respondent concerned to the petitioners. Undisputedly, M/s. U. P. Car bide and Chemicals Ltd. had made certain supplies to each of the petitioners and the price there of has not been paid. This has resulted is recovery proceedings initiated by the U. P. Carbide and Chemicals Ltd. under the Recovery Act. When the writ petitions were filed counter-affidavits were called. It transpires that M/s. U. P. Carbide and Chemicals Ltd. have gone in the meantime under liquidation. Conse quently, it is now represented by the Offi cial Liquidator on whose behalf Sri Sunil Ambwani, learned Counsel, has put in ap pearance. Counter- affidavits have been filed by the Official Liquidator. Rejoinder affidavits have also been filed by the petitioners to those counter-affidavits. In terim orders were passed while entertain ing the writ petitions staying realisation proceedings under the Recovery Act and as prayed by the parties' learned Counsel the writ petitions are being disposed of finally at the admission stage. Sri S. C. Budhwar, Senior Counsel, assisted by Sri Anil Sharma and Sri R. P. Agrawal, has been heard at considerable length in support of this writ petition. Sri Sunil Ambwani appearing on behalf of M/s. U. P. Carbide Chemicals Ltd. (under, liquidation) and Sri Virendra Kumar, Standing Counsel, appearing on behalf of the State of Uttar Pradesh have been heard in opposition at length. At the very out-set it may be pointed out that Courts are reluctant in interfering in matters where advantage is taken by a person or a firm or company in business transactions and payment is not made or is evaded on one ground or the other. It was rightly pointed out by the respondents' Counsel where defaulters who may be proceeded with under the Recovery Act comes to Court for equitable relief under Article 226 of the Constitu tion of India, such person, firm or com pany, finds it difficult to get such a relief from the Court. But, as stated above, a particular mode of recovery in a concerned transaction is quite different from the money being due as price of the materials supplies. The provisions under the Recovery Act would apply only where it is permissible by those provisions. In other cases where price of the goods/materials supplied, if remains unpaid, mode of recovery has to be found out somewhere else and not under the provisions of Recovery Act.
(3.) FROM the materials on record there does not appear to be any State Sponsored Scheme under which any of the petitioners may have been supplied any material or goods. At least counter- affidavits are silent on this point. The Court, therefore, is to proceed on the basis of that. There is some force in the contention of the learned Counsel for the petitioners which have been repeatedly averred in various para graphs of the writ petition that each of the petitioners had entered into mercantile transaction with the opposite party No. 3, M/s. U. P. Carbide and Chemicals Ltd. FROM the pleadings it has been further made clear that the price for the supply of the goods has not been paid. The conten tion of the petitioners that they had raised some dispute about quality of the goods is criticised by the learned Counsel for the respondents as totally baseless and false and were castigated as having been made with ulterior motive But that question is simply foreign at this stage in this writ petition 6, The Recovery Act has defined 'corporation' in Section 2 (a) and 'government company' in Section 2 (c) and it has defined 'state- sponsored scheme' in Section 2 (g ). Then it has delineated the mode of recovery as arrears of land revenue by four contingencies enumerated in clauses (a), (b), (c) and (d) of sub-section (1) of Section 3 of the Recovery Act. Keeping these provisions in the background three arguments advanced by Sri S. C. Budhwar have to be considered: (1) That U. P. Carbide and Chemicals Limited is not notified as Corporation within the meaning of Section 2 (a) of the Recovery Act and, therefore, it could not take recourse to the present recovery modes. (2) That there was no State-sponsored scheme under which the petitioners were ad vanced or granted or supplied any goods or materials and consequently for the recovery of its price the provisions under Section 3 of the Recovery Act cannot be put to use. (3) That the transaction was a simple mer cantile transaction between the petitioners and M/s. U. P. Carbide and Chemicals Ltd. and for that reasons also the present proceedings are wholly without jurisdiction. 7. The first argument to the effect that M/s. U. P. Carbide and Chemicals Ltd. cannot use the provisions of the Recovery Act is without any force. Admittedly, the opposite party No. 3, M/s. U. P. Carbide and Chemicals Limited is a subsidiary company of U. P. State Mines and Minerals Development Corporation, which cor poration is already a notified corporation within the meaning of Section 2 (a) of the Recovery Act, which is quoted below: "2 (a) : "corporation" means the Uttar Pradesh Financial Corporation established under the State Financial Corporation Act, 1951, and includes any other Corporation owned or controlled by the Central Govern ment or the State Government and specified in a notification issued in that behalf by the State Government in the official Gazette. " 8. Section 617 of Companies Act has made it permissible that subsidiary com pany of a Government company. will be included within the meaning of the words, 'government Company' as defined there in. Section 2 (c) of the Recovery Act says that 'government Company' means a Government Company as defined in Sec tion 617 of the Companies Act, 1956. It is not in dispute that M/s. U. P. Carbide and Chemicals Ltd. is a subsidiary company of the aforesaid. U. P. State Mines and Minerals Development Corporation. In view of this clear provision there is no force in the arguments that M/s. U. P. Car bide and Chemicals Ltd. cannot take recourse to the provisions of the Recovery Act. In a given case it is permissible for M/s. U. P. Carbide and Chemicals Ltd. to invoke the provisions of the Recovery Act. 9. Both the remaining arguments have, however, enough force. As alrea'dy noted above, none of the petitioners took any advantage of entering into any transac tion under the provisions of any State- sponsored Scheme. Likewise, at no point of time the petitioners seem to have ap proached M/s. U. P. Carbide and Chemicals Ltd. for according any financial assistance or loan under any State-sponsored scheme. Obviously, the transactions of the petitioners were simple mercantile trans actions. It appears that M/s. U. P Carbide and Chemicals Ltd. had supplied some goods/materials to each of petitioners and price thereof has not been paid by any of the petitioners to the aforesaid supplier. Consequently, in view of the provisions noted above, M/s. U. P. Carbide and Chemicals Ltd. , on facts of these cases cannot invoke any of the clauses (a), (b), (c) and (d) of Section 3 of the Recovery Act against any of the petitioners for recovery of the money which it claims to be due against them under ordinary business transaction. 10. In view of the aforesaid discus sions, the writ petitions have to succeed. However, it is made clear that any other mode of recovery which is available to the respondents can be resorted to wholly uninfluenced by any observation existing in this judgment which has the effect of nullifying the recovery mode only under the provisions of the Recovery Act. 11. The writ petitions No. 29614 of 1991, 24425 of 1991 and 38860 of 1996 succeed and are allowed. The recovery cer tificate dated 6-10-1990 (Annexure-17), citation No. 132803, dated 21-8-1991 (An- nexure-9), and the recovery certificate dated 6-11-1996 (Annexure-18) of the respective writ petitions are quashed. No action in pursuance of those recovery cer tificates or citation shall be taken against the petitioners and, if taken already, shall stand quashed. Interim orders granted in all the writ petitions are hereby vacated. Parties will bear their own costs. Petitions allowed. .;