The Rajasthan High Court has cancels the recovery notices issued by the Department of Mining and Geology, Government Secretariat, Jaipur. These notices sought to recover amounts owed for a Short Term Permit (STP) granted to the petitioner, despite the absence of a prior demand order for such recovery.

The single-headed bench of Justice Avneesh Jhingan's bench observed that it is well-established law that recovery notices must be preceded by an order that creates a demand for the recovery.

The Court was reviewing a petition from a petitioner who had been granted a Short Term Permit (STP) for mining earth in 2006 and had deposited a security amount. In 2007, the petitioner applied to surrender the STP, but the Mining Engineer rejected this application and issued a demand notice for the amount payable concerning the STP. When the petitioner failed to pay, the security amount was forfeited. The petitioner filed a revision application challenging the forfeiture order, and the revisional authority overturned the forfeiture, sending the matter back for a fresh decision.

Following the remand, the respondent issued new recovery notices and initiated recovery proceedings against the petitioner. The petitioner challenged these recovery notices in court, arguing that the recovery proceedings were commenced without any preceding order authorizing them.

The Court concurred with the petitioner’s counsel, noting that since the revisional authority had nullified the original demand order, no new demand order had been issued by the respondent. Consequently, there was no valid demand order in place after the revision order. The Court reaffirmed the principle that recovery notices must be preceded by a valid demand order.

In the absence of any such order, the recovery notices were set aside by the Court allowing the petition.

Case Title: Damodar Lal Gupta v State of Rajasthan