2018 (4) TMI 1927 - HC - Customs

Attachment of property - default in repayment of loan - case of the petitioner is that they purchased the subject property in an auction conducted by the secured creditor pursuant to an action initiated under the said Act and that the subject property, which was brought for auction, was owned by the defaulter namely M/s. DDS Steel Rolling Mills Private Limited and not the said M/s. SDS Steels Private Limited and the said M/s. Jai Bhawani Steel Enterprises - who is the actual owner of property attached? HELD THAT - The petitioner requested the Customs Authorities to lift the attachment and in this regard, a representation was sent on 16.9.2017, followed by reminders dated 05.10.2017 and 25.10.2017. Having not been favoured with any response, the petitioner is before this Court for appropriate directions to the respondent. The fact that the petitioner has made a representation for lifting the attachment is not in dispute, as the Department, by letter dated 16.10.2017, requested for details from the petitioner, which the petitioner has furnished. The writ petition is disposed of with a direction to the respondent to consider the petitioner's representations dated 05.10.2017 and 25.10.2017 as well as the documents furnished along with the representation dated 25.10.2017, afford an opportunity of personal hearing to the authorized representative of the petitioner and pass orders on merits and in accordance with law, within a period of eight weeks from the date of receipt of a copy of this order.

Summary

Issues:
1. Validity of property auction and sale certificate.
2. Attachment of subject property by Customs Department.
3. Request for lifting the attachment by the petitioner.
4. Court's direction to the respondent.

Analysis:
1. The subject property, originally owned by M/s. DDS Steel Rolling Mills Private Limited, was mortgaged to Indian Overseas Bank. Due to default, the property was auctioned, and the petitioner emerged as the successful bidder in 2012. A sale certificate was issued, but a corrigendum was later issued due to missing details. The petitioner faced issues with registration due to an attachment by the Customs Department on properties of other companies adjacent to the subject property.

2. The petitioner contended that the attachment was unjust as it was not related to the defaulter company, M/s. DDS Steel Rolling Mills Private Limited, from whom the property was purchased. Despite representations to lift the attachment, the Customs Department did not respond adequately. The Department requested details from the petitioner, which were provided, indicating the petitioner's efforts to resolve the matter amicably.

3. In light of the above, the Court directed the respondent to consider the petitioner's representations and documents, provide a personal hearing, and make a decision within eight weeks. The Court emphasized that the respondent should evaluate the petitioner's submissions and act in accordance with the law. The judgment did not impose any costs on either party, focusing on resolving the issue of attachment through due process and fair consideration of the petitioner's claims.