Revenue Recovery Notice in Kerala: What It Means and What You Can Do

A revenue recovery notice usually comes from the Village Office or the Tahsildar, not from the bank. That surprises many people who took a loan from a co-operative bank, KSFE or a public sector bank, but in Kerala many institutions recover their dues through the revenue authorities rather than through the courts.

This guide explains what a revenue recovery notice means, what can happen next, and the options that remain open.

The Kerala Revenue Recovery Act, 1968 allows dues to the Government, and dues to institutions notified by the Government, to be recovered as if they were arrears of land revenue. Banks, KSFE, co-operative societies, the Kerala Financial Corporation and government departments commonly use it.

Once the creditor sends a requisition to the District Collector, the revenue authorities, usually the Tahsildar and the Village Officer, take the recovery forward.

The first document is usually a demand notice from the revenue authorities, stating the amount due, including interest and collection charges, and requiring payment within a set time. If the amount is not paid, the authorities can proceed to attach movable or immovable property and, eventually, to sell it by public auction.

Check every notice carefully: the name of the defaulter, the loan account, the amount, the property described, and whether you have been given the time and opportunity the law requires.

Attachment prevents the property from being sold or transferred while the recovery is pending. If the dues remain unpaid, the property can be brought to sale. Before a sale, notice must be given and the sale proclaimed. A defaulter who pays the dues and charges within the time allowed can have the sale stopped or set aside.

In practice, many revenue recovery matters are resolved by payment in instalments or by a settlement with the creditor. Requests for instalments or for a temporary stay can be made to the revenue authorities and, in appropriate cases, to the Government. The creditor institution, particularly a co-operative bank or KSFE, may also offer a one-time settlement or a revised schedule.

A request supported by a realistic repayment proposal, and by documents showing genuine hardship such as illness or loss of employment, has the best chance.

• The amount claimed is wrong, includes charges that are not due, or ignores payments already made.
• The institution is not entitled to use revenue recovery for this debt.
• The loan is disputed, or the person served is only a guarantor whose liability is contested.
• The required notices and procedure were not followed before attachment or sale.

Depending on the defect, the remedy may be a representation to the Collector, a proceeding before the relevant authority or court, or a writ petition before the High Court of Kerala. See our guide to writ petitions in the Kerala High Court.

Some lenders, particularly banks, may use the SARFAESI Act instead of, or in addition to, revenue recovery. The procedures, time limits and remedies are different. If your notice refers to Section 13(2) of the SARFAESI Act, read our guide on what to do after a SARFAESI notice.

Adv. K Rajesh Kannan, a High Court of Kerala advocate with over 24 years of practice, advises borrowers and guarantors facing revenue recovery from banks, KSFE, co-operative societies and government departments, from verifying the amount and negotiating instalments or settlement to challenging unlawful recovery before the authorities and the High Court. See the Banking Law page.

Questions people often ask

Why did I get a notice from the Village Office for a bank loan?
Because the lender has asked the revenue authorities to recover the loan under the Kerala Revenue Recovery Act, which lets certain dues be recovered like land revenue.

Can I pay in instalments?
Instalments and temporary stays are possible in many cases, on request to the revenue authorities or the Government, and by agreement with the lender.

Can my property be auctioned?
Yes, if dues remain unpaid after attachment and the procedure is followed. Paying the dues within the time allowed can stop or set aside the sale.

This guide gives general information about the law in Kerala. It is not legal advice on any particular case.