Sudhir Narain, J. - (1.) The petitioner seeks writ of certiorari quashing the citation notice dated 18.1.1999 demanding sum of Rs. 12,277 plus interest and other charges.
(2.) The petitioner took loan for a pumping set, from Allahabad Bank, respondent No. 3. As the petitioner failed to pay the amount, recovery certificate was sent and respondent No. 2 issued a citation for recovery of Rs. 12.277.
(3.) The contention of learned counsel for the petitioner is that respondent No. 2 is demanding collection charges at ten per cent of the amount mentioned in the recovery certificate. It is contended that the property has yet not been auctioned and unless the auction takes place, the petitioner is not liable to pay any collection charges. He has placed reliance upon the decision of the Division Bench in Mirza Javed v. U. P. Financial Corporation, Kanpur and another, AIR 1983 Alt 234, wherein it was held that where the State Financial Corporation sent a certificate under Section 3 of U. P. Public Moneys (Recovery of Dues) Act to the Collector for recovery of the loan advanced by it as arrears of land revenue, it cannot include the collection charges in the certificate in view of Rule 284 of U. P. Zamindari Abolition and Land Reforms Rules. The recovery proceedings start only if the recovery certificate is received by the Collector and thereafter he proceeds to realise the amount from the person against whom the recovery certificate has been issued. At the stage of preparation of the recovery certificate, the question of collection of recovery charges does not arise and in that context the Court observed : "What would be the actual cost of the proceedings would be naturally ascertained when the costs are actually incurred. This is also clear from Rule 284 (2) of the U. P. Zamindari Abolition and Land Reforms Rules which says that charge shall be levied for recovery upon such amount not exceeding the total sum due for recovery as may be realised by the sale at the rate of 3 n.p. per rupee of the sale proceeds. So the charge can be levied only when the sale of the property actually takes place.";