1. Through this habeas corpus petition filed under section 491, Cr. P. C. The petitioner seeks his release from illegal custody alleging that he is only a guarantor/surety of the original loanees and without initiating legal proceedings against the original borrowers the coercive measures have been adopted against the petitioner without observing the formalities under sections 82 and 24 of the Punjab Lana Revenue Act, 1967 and that his detention is illegal.
2. The respondent No.2 was directed to produce the detenu in the Court. The respondent Assistant Collector Grade-I has appeared alongwith the record. I find that the manager issued a certificate to the District Collector, Rawalpindi stating that a sum of Rs.2,54,233 was due on 30-6-1999 from Mr. Zahid Mehmood. The petitioner was a guarantor, the sum may be recovered as arrears of land Revenue under section 22 of the Small Business Finance Corporation Act, 1972 read with section 80 of the Land Revenue Act of 1967. The certificate is not dated. The District Collector issued a recovery notice on 10-11-1990 without issuing any notice to the petitioner or the borrower/defaulter. A notice to the petitioner appears to have been issued by respondent No.2 on 3-6-2001. The borrowers and the other surer could not be traced, the warrants of arrest of the petitioner were issued on 20th January, 2002. He was arrested on 2-2-2002 and sent to jail till 12-2-2002.
2. Admittedly the original borrowers could not be served a notice for recovery of the loan/finance as they were allegedly absconders. No suit before a competent authority has been filed by Small Business Finance Corporation nor is there a determination of arrears by the competent authority in accordance with law. Section 22 of the Small Business Finance Corporation Act, 1972 reads as under:--- "22. Recoveries.--- Without prejudice to the provisions of sections 20 and 21 all sums due to the Corporation shall be recoverable as arrears of Land Revenue.
3. Provided that no sum shall be recovered unless fifteen days' notice has first been given by the Corporation to the debtor that the sum will be so-- recovered: Provided further that in so giving notice the Corporation shall inform the debtor that he may pay such insalments as may be fixed in the notice and that upon his so paying every instalment on or before the due date the recovery will be suspended but that it will otherwise proceed as to the entire sum outstanding in case of any default in any instalment including the first."
4. Under section 21 of the said Act the Corporation may initiate proceedings for recovery of the outstanding loan. Without having done so the corporation straightway proceeded to recover the alleged amount as arrears of Land Revenue. The alleged amount is merely a claim and has not been determined by competent authority. In the case of Muhammad Akbar Cheema v. The Province of West Pakistan 1984 SCM R 1047 the Honourable Supreme Court while deciding a similar question about recovery of dues as Land Revenue under the West Pakistan Land Revenue Act, 1967 held as under:-- "the machinery provisions of the Revenue Act could only be set into motion after the claim against the appellant had actually ripened into dues and determined on the basis of some adjudication in accordance with law and justice."
5. PLD 1988 SC 67 where the coercive machinery had been set into motion under the Agricultural Development Bank Ordinance, 1961 it was observed as under:-- "On parity of reasoning, therefore, the machinery provisions for the realisation of amount as arrears of land revenue under section 25 of the Ordinance could only be invoked after the procedure for determination of arrears due is adopted and duly certified. In absence of such a certificate the person concerned, without being given an opportunity or hearing, will not be defaulter within the meaning of the law. Otherwise a mere claim could be recovered by one of the parties to the contract by the coercive procedure provided in the Ordinance. Such unjust and arbitrary power could not be attributed to have been conferred on the functionary by the Legislature."
6. As stated above there is no determination of the amount due by the competent authority nor the provisions of law have been observed before invoking the coercive measures. I, therefore, allow this petition and set the petitioner at liberty.