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Showing 21 to 40 of 1566 Records
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2023 (7) TMI 1549
Maintainability of petition - availability of alternative remedy - non-constitution of Second Appellate Tribunal - HELD THAT:- Since the petitioner wants to avail the remedy under the provisions of law by approaching 2nd appellate tribunal, which has not yet been constituted, as an interim measure subject to the Petitioner depositing entire tax demand within a period of fifteen days from today, the rest of the demand shall remain stayed during the pendency of the writ petition.
Application disposed off.
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2023 (7) TMI 1548
Maintainability of petition - availability of alternative remedy - non-constitution of Second Appellate Tribunal - HELD THAT:- Since the petitioner wants to avail the remedy under the provisions of law by approaching 2nd appellate tribunal, which has not yet been constituted, as an interim measure subject to the Petitioner depositing entire tax demand within a period of fifteen days from today, the rest of the demand shall remain stayed during the pendency of the writ petition.
Application disposed off.
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2023 (7) TMI 1547
Short payment of Excise duty - capital/wage subsidy received under the Rajasthan Investment Promotion Policy is includable in the transaction value in terms of Section 4(3) (d) of the Act or not - reduction in the selling price - additional consideration or not - HELD THAT:- The third Hon’ble Member vide [2023 (3) TMI 1120 - CESTAT NEW DELHI] has decided the issue holding that 'Subsidy under the promotion policy does not reduce the selling price'
Conclusion - Since the subsidy under Promotion Policy is held to not to be an additional consideration, it is held that the impugned demands cannot sustain.
Appeal allowed.
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2023 (7) TMI 1546
Manipulation or structured trade - Fraudulent and Unfair Trade Practices under SEBI Act - trading pattern of the buyers and the sellers was that they traded in close proximity of time inter-se between them
HELD THAT:- No manifest error requiring review. The applications fail and are dismissed.
This order will be digitally signed by the Private Secretary on behalf of the bench and all concerned parties are directed to act on the digitally signed copy of this order. Certified copy of this order is also available from the Registry on payment of usual charges.
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2023 (7) TMI 1545
Direction to second respondent to consider and dispose of Exts.P2 appeal and Ext.P3 stay petition, expeditiously - HELD THAT:- Having considered the pleadings and materials on record and taking note of the fact that Ext.P3 stay petition is pending consideration before the second respondent since 3.6.2023, it is deemed appropriate to dispose of the writ petition - The second respondent is directed to consider and dispose of Ext.P3 stay petition, in accordance with law and as expeditiously as possible, at any rate within a period of three months from the date of receipt of a certified copy of the judgment, after affording the petitioner an opportunity of being heard.
Petition disposed off.
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2023 (7) TMI 1544
Seeking to quash the order passed by the authority under Annexure-7, and to issue direction to the opposite parties to refund of amount paid towards service tax in excess within a stipulated time - HELD THAT:- Having heard learned counsel for the parties and after going through the records, this Court finds that the petitioner is seeking to quash the order dated 21.03.2023 passed by the authority under Annexure-7, which is appealable one and, as such, instead of preferring appeal, the petitioner has approached this Court by filing the present writ petition, which is not maintainable. So far as refund of Rs. 24,32,767/- is concerned, without making appropriate application before the appropriate forum for refund thereof, the petitioner has approached this Court by filing the present writ petition. Thereby, the writ petition is premature one.
Petition disposed off.
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2023 (7) TMI 1543
Seeking issuance of a direction to the respondents to issue “C” form to the petitioner company - HELD THAT:- It is not disputed that the issue involved in the present case is no more res integra and is squarely covered by the ratio of the judgment rendered by this Court in the case of HINDUSTAN ZINC LIMITED, SOUTH WEST MINING LTD., KHETAN BUSINESS CORPORATION PVT. LTD., ARORAS JK NATURAL MARBLES LIMITED VERSUS STATE OF RAJASTHAN THROUGH THE PRINCIPAL SECRETARY, DEPARTMENT OF FINANCE, SECRETARIAT, JAIPUR, THE COMMISSIONER, COMMERCIAL TAXES DEPARTMENT, THE COMMERCIAL TAXES OFFICER [2018 (5) TMI 1871 - RAJASTHAN HIGH COURT] where it was held that 'It is held that the respondents are liable to issue `C' Forms in respect of the High Speed Diesel procured for mining purposes through interstate trade. In the event of the petitioners having had to pay any amount on account of the respondents wrongful refusal to issue `C' Forms the petitioners shall be entitled to refund and/or adjustment of the same from the concerned authorities who collected the excess tax.'
It is held that the respondents are liable to issue ‘C’ Forms in respect of the High Speed Diesel procured for mining purposes through interstate trade. In the event of the petitioner having had to pay any amount on account of the respondents wrongful refusal to issue `C' Forms, the petitioner shall be entitled to refund and/or adjustment of the same from the concerned authorities who collected the excess tax - petition allowed.
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2023 (7) TMI 1542
Appeal preferred by the writ petitioner being the consignor was dismissed - HELD THAT:- Having seen the provisions as made under Section 107(1) this Court concurs with the finding of the coordinate Bench as contained in the order dated 3rd November, 2022. Therefore it is found that the finding made by the Appellate Authority as contained in the order dated 3rd January, 2022 is not sustainable in view of Section 107(1) of the said Act of 2017. Accordingly, the order of the Appellate Authority dated 3rd January, 2022 stands set aside.
Petition disposed off.
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2023 (7) TMI 1541
Maintainability of petition - availability of alternative remedy - entitlement to benefit of stay of recovery of balance amount of tax in terms of Section 112 (8) and (9) of the B.G.S.T Act upon deposit of the amounts as contemplated under Sub-section (8) of Section 112 - HELD THAT:- The respondent State authorities have acknowledged the fact of non-constitution of the Tribunal and come out with a notification bearing Order No. 09/2019-State Tax, S. O. 399, dated 11.12.2019 for removal of difficulties, in exercise of powers under Section 172 of the B.G.S.T Act, which provides that period of limitation for the purpose of preferring an appeal before the Tribunal under Section 112 shall start only after the date on which the President, or the State President, as the case may be, of the Tribunal after its constitution under Section 109 of the B.G.S.T Act, enters office.
Subject to deposit of a sum equal to 20 percent of the remaining amount of tax in dispute, if not already deposited, in addition to the amount deposited earlier under Sub-Section (6) of Section 107 of the B.G.S.T. Act, the petitioner must be extended the statutory benefit of stay under Sub-Section (9) of Section 112 of the B.G.S.T. Act. The petitioner cannot be deprived of the benefit, due to non- constitution of the Tribunal by the respondents themselves. The recovery of balance amount, and any steps that may have been taken in this regard will thus be deemed to be stayed.
Petiiton disposed off.
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2023 (7) TMI 1540
Reimbursement of the amount of Goods and Services Tax (GST) leviable upon the petitioner @ 12% after adjusting the tax benefit of pre-GST regime which is already embedded in respect of work awarded to the petitioner - HELD THAT:- In view of the limited prayer made by the petitioner in this writ application, the same stands disposed of with a liberty to the petitioner to file a fresh representation giving in details his claim before the respondent No. 3 within a period of three weeks and if such representation is preferred, the respondent No. 3 shall consider it and pass a reasoned and speaking order within a period of four weeks from the date of submission of the representation.
Application disposed off.
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2023 (7) TMI 1539
Disallowance of expenditure towards employees contribution to ESIC/PF u/s 36(1)(va) -Timing of Salary Disbursement and Due Date Determination - HELD THAT:- The issue towards taxability of belated employees’ contribution to PF/ESIC is no longer res integra in the light of the judgment of Hon’ble Supreme Court in the case of Checkmate Services [2022 (10) TMI 617 - SUPREME COURT] thus no merit in the case of the assessee for impermissibility of such adjustment u/s 143(1) of the Act.
Determination of due date - Month during which the disbursement of salary is actually made would be relevant for the purposes of determination of due date of deposit under the respective statute. The accrual of liability towards payment of salary without actual disbursement would not fasten obligation for deposits of employees contribution in the labour Acts per se. as observed by the co-ordinate bench in Kanoi Paper and Industries Ltd.[2001 (5) TMI 139 - ITAT CALCUTTA-E] - This aspect has not been found to be examined by the AO or CIT(A). Hence without expressing any opinion on merits on this aspect, we deem it expedient to restore the matter to the file of designated AO. It shall be open to the assessee to place factual matrix before the AO and take such plea for evaluation of the AO. The AO shall examine this aspect and fresh order in accordance with law after giving proper opportunity.
AO shall thus recompute the amount of disallowance u/s 36(i)(va) if any, on the above basis, in accordance with law. Assessee shall be entitled to appropriate relevant u/s 36(i)(va) where it is found that deposits have been made towards PF/ESIC within the due date from the close of month of actual disbursement of salary/wages - Appeal of the assessee is allowed ex-parte for statistical purposes.
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2023 (7) TMI 1538
Delayed contributions towards PF & ESI - additions made under the umbrella of S. 143(1) - grant of deduction under general provisions for deduction of expenditure u/s 37 - HELD THAT:- No merit in such plea that the belated deposit of employees contributions to PF/ESIC governed u/s 36(1)(va) is also simultaneously amenable to deduction under Section 37(1) of the Act. In terms of the provision, Section 37(1) permits deduction of expenditure which is not in the nature of expenditure prescribed in Sections 30 to 36 of the Act and also not being in the nature of capital expenditure or personal expenses of the assessee. Thus, in view of such mandate of law, the deduction of expenditure under the general clause of Section 37(1) would not extend to expenditure specially covered within the ambit of Section 36(1)(va) of the Act.
The Hon’ble Supreme Court in the case of Checkmate Pvt. Ltd. [2022 (10) TMI 617 - SUPREME COURT] itself explains this position - Such view also draws support from the observations made in recent judgment in the case of Pr.CIT vs. Khyati Realtors (P) Ltd. [2022 (8) TMI 1141 - SUPREME COURT]. The alternate plea is thus without any merit.
Methodology of calculation of default under the relevant PF/ESIC Act - as contented the month during which the disbursement of salary is actually made would be relevant for the purposes of determination of due date of deposit under the respective statute - The accrual of liability towards payment of salary without actual disbursement would not fasten obligation for deposits of employees contribution in the labour Acts per se. as observed in Kanoi Paper and Industries Ltd. [2001 (5) TMI 139 - ITAT CALCUTTA-E].
This aspect has not been found to be examined by the Assessing Officer or CIT(A). Hence without expressing any opinion on merits on this aspect, we deem it expedient to restore the matter to the file of designated AO.
Therefore in view of foregoing discussion and observations the intimations u/s. 143(1) of the Act for AY 2019-20 is set aside and the issue of allowability of employees contribution to ESIC & PF is restored to the file of Assessing Officer for a fresh adjudication after allowing due opportunity of hearing to the assessee by considering the explanation and factual matrix of the issue and factual contentions of assessee, without being influence with the earlier intimation and first appellate order.
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2023 (7) TMI 1537
Locus standi to challenge the order of the Competition Commission of India (CCI) - SCN to be issued to the parties to combination, i.e., both acquirer and the target entity or word ‘parties’ occurring in Section 29(1) has to be read singularly - non-issuance of Show Cause Notice to HNG vitiates the order of approval granted by the Commission under Section 31, sub-section (1) or not - combination is likely to cause an appreciable adverse effect on competition by the CCI under Section 29, sub-section (1) or not - process as contemplated under Section 29, sub- section (2) having not been completed by the CCI before passing the order, the order passed by the CCI is against the procedure prescribed under Section 29 and deserved to be set aside - obligation to direct the parties to publish details of the combination - modifications suggested by Respondent No.2 in its reply to Show Cause Notice, adequately addressed the AAEC as expressed in the Show Cause Notice under Section 29, sub- section (1) - non-application of mind - violation of principles of natural justice.
Whether the Appellant(s) have locus to challenge the order of the Competition Commission of India dated 15.03.2023 within the meaning of Section 53B of the Competition Act, 2002? - HELD THAT:- In the Judgment of the Hon’ble Supreme Court in Samir Aggarwal [2020 (12) TMI 621 - SUPREME COURT] where Hon’ble Supreme Court was considering the expression ‘person aggrieved’ in context of the Competition Act it was categorically held by Hon’ble Supreme Court that the expression person aggrieved has to be understood widely and not be constructed narrowly.
The present is a case where Appellants are challenging the order passed by the Commission approving the combination of two biggest market players in container glass industry. It is contended in the Appeal that approval of the combination has been done in breach of the procedure prescribed in the Competition Act. We have noticed the pleading in C.A. (AT) No. 7/2023 where it is specifically pleaded that Appellant is also a body of micro and small manufacturers of glass based in UP which represent the interest of MSME Glass Manufacturer. The Appellant in the Appeal pleads and has enumerated various consequences of combination of two largest players in market. The Appellant expresses apprehension and filed objection before the CCI even before the approval of the combination and the Commission vide its letter dated 23.02.2023 has noted the concern raised by the Appellant and Appellant was communicated that their concerns shall be noted at the relevant time - the objection of the Respondents that none of the Appellants have locus to file the Appeal is rejected.
Whether Section 29, sub-section (1) contemplates that a Show Cause Notice to be issued to the parties to combination, i.e., both acquirer and the target entity or word ‘parties’ occurring in Section 29(1) has to be read singularly? - HELD THAT:- There can be no quarrel to the provision of General Clauses Act that words in singular includes plural and vice versa but when we look into the specific purpose and object which is delineated by Section 29(1), in show cause notice to both the parties, we cannot agree with the submission of the CCI that parties in the present case shall only be the AGI who has given notice under Section 6(2). There can be no doubt that Respondent No. 2-AGI who has given notice under Section 6(2) is included within the definition of parties. The show cause notice specifically required to be given to both of them. The statute clearly contemplates issuance of show cause notice to both the parties of the combination - Section 29(1) of the Act, contemplates that show cause notice has to be issued to both parties to the combination i.e. acquirer and target entity.
Whether non-issuance of Show Cause Notice to HNG vitiates the order of approval granted by the Commission under Section 31, sub-section (1)? - HELD THAT:- In the facts of the present case, especially that Respondent No. 3 is in insolvency and the Resolution Professional himself has placed proposal for acquisition of Respondent No. 2 which has been approved by the Committee of Creditors and all details and information have been given by Respondent No. 2 in its notice under Section 6(2) of Competition Act which relate both to Respondent No. 2 and Respondent No. 3, non-issuance of notice to target entity i.e. Respondent No. 3 is not to ipso facto vitiate the order of the Commission when Respondent No. 3 has neither any objection nor grievance regarding non-service of notice to Respondent No. 3 and information regarding Respondent No. 3 are all in public domain which has been used by Respondent No. 2 in submitting the notice. By mere non-issuance of notice to Respondent No. 3, the proceedings before the CCI need not be annulled.
Whether after formation of prima-facie opinion that combination is likely to cause an appreciable adverse effect on competition by the CCI under Section 29, sub-section (1), there was no occasion to form again a prima facie opinion under Section 29(2) after receipt of response to the Show Cause Notice and the CCI was required to complete the further process under Section 29(2) including direction to the parties to the combination to publish details of combination? - Whether the process as contemplated under Section 29, sub- section (2) having not been completed by the CCI before passing the order dated 15.03.2023, the order passed by the CCI is against the procedure prescribed under Section 29 and deserved to be set aside? - Whether inspite of Respondent No.2 along with response to Show Cause Notice having offered modification to address the prima facie concern expressed in the said Show Cause Notice as per Regulation 25 (1) (a) of 2011 Regulations, the CCI was obliged to direct the parties to publish details of the combination? - HELD THAT:- The bone of contention of the parties is as to whether after formation of prima facie opinion under Section 29(1), whether there was any requirement of formation of prima facie opinion at the second time under sub-section (2) of Section 29. Whereas the Appellant(s) pleads that there is no requirement of formation of prima facie opinion at the second time and when notice under Section 29, sub-section (1) has been issued, even after response to the notice, the Commission is required to direct the parties to the combination to publish the details of the combination. The Appellants’ contention is that Section 29, sub-section (2), insofar as it directs for publishing the details of the combination having not been complied, the statutory procedure has not been complied by the Commission, resulting in vitiation of the order approving the combination dated 15.03.2023. The contention of the CCI and other Respondents is that formation of prima facie opinion is required at the second stage as per Section 29 sub-section (2), when response is received to the notice and the requirement of publication of details of the combination comes into play only when prima facie opinion is formed at the second time.
The plain reading of Section 29, sub-section (2) indicates that the Commission, if it is prima facie of the opinion that combination is likely to have an appreciable adverse effect on competition, it shall, within seven working days from the date of receipt of the response of the parties to the combination, or the receipt of the report from Director General called under sub-section (1A), whichever is later, direct the parties to the said combination to publish details of the combination - The legislative intent is clear by sub-section (2) of Section 29 that there may be cases where the Commission is satisfied after response of the notice or the report of the Director General that there is no appreciable adverse effect on competition, it may decide not to proceed further under Section 29, sub-section (2) and approve the combination. The submission of the Appellant(s) that prima facie opinion at the second stage is not required to be formed does not commend.
As per the statutory provisions contained in Section 29 and the Regulations 2011, after receipt of the response to show-cause notice, the Commission has to form prima facie opinion at the second stage as required by Section 29, sub-section (2) and in cases where prima facie opinion at the second stage under Section 29, sub-section (2) has not been formed and the Commission is satisfied that the response received in the modification, if any, submitted by the Party does not meet the requirements of law, the Commission directed publication of details of combination in such cases - the Commission proceeded to approve the combination by following the statutory procedure prescribed under Section 29 as well as Regulations 2011. Further, in the facts of the present case, under sub-section (2) of Section 29, the publication of details of combination was not required to be directed, since at the second stage, the Commission did not form any prima facie opinion of AAEC - the Commission had duly considered the modification submitted by AGI in response to the show-cause notice and after accepting the modification, proceeded to approve the combination under Section 31, sub-section (1).
Whether order of the Commission dated 15.3.2023 can be said to have been passed in violation of principles of natural justice since the objections filed by Appellant the U.P. Glass Manufacturers Syndicate even after the order dated 22.02.2023 were not duly considered? - HELD THAT:- The principles of natural justice are generally to be followed when a decision is taken, which has civil consequence on any person or entity. The Competition Act, 2002 and the Regulations framed thereunder, specially Combination Regulations 2011 provides a detailed procedure and manner in which participation of others including Members of the pubic and other parties have to be allowed - The right of participation of public in general and other entities arises when under Section 29, sub-section (2) of the Act, the Commission directed the parties to the combination to publish the details of the combination within seven days from of such direction, for bringing the combination to the knowledge or information of the public and persons affected or likely to be affected. The stage for filing any objection or giving any information by public in general including the Appellant – UPGMS can arise only when details of the combination are published under Section 29, sub-section (2). In the present case, stage of direction to publish details of combination had not arisen, since there was no prima facie opinion formed at the second stage under Section 29, sub- section (2) - The right to third parties to submit objections arises when the Commission issues direction to the parties to publish the details of the proposed combination, which stage never arose in the present case - in the procedure adopted by the Commission in inquiring the notice under Section 6, sub-section (2), there is no violation of principles of natural justice, which can be attributed to the Commission.
Conclusion - i) The appellants have locus standi to challenge the CCI's order, as the term "aggrieved person" is broadly interpreted in the context of the Competition Act. ii) The CCI should have issued the show-cause notice to both the acquirer and the target entity, as required by Section 29(1). iii) The non-issuance of notice to HNG did not vitiate the CCI's order, given the insolvency context and lack of objection from the Resolution Professional. iv) The CCI's process was compliant with the statutory procedure, and the acceptance of modifications addressed AAEC concerns, negating the need for a second prima facie opinion and publication of details. v) The CCI's process did not violate principles of natural justice, as the procedural framework did not require public participation at the stage reached.
Appeal dismissed.
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2023 (7) TMI 1536
Entertainability of petition - alternative remedy of appeal - Second Appellate Tribunal has not yet been constituted - contravention to sub-sections (1) & (4) of Section 107 of the GST Act - HELD THAT:- Since the petitioner wants to avail the remedy under the provisions of law by approaching 2nd appellate tribunal, which has not yet been constituted, as an interim measure subject to the Petitioner depositing entire tax demand with in a period of fifteen days from today, the rest of the demand shall remain stayed during the pendency of the writ petition.
Application disposed off.
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2023 (7) TMI 1535
Maintainability of petition - Second Appellate Tribunal has not yet been constituted - demand relating to penalty and fine - HELD THAT:- Perusal of order dated 7th June, 2023, it is found that challenge before the first appellate authority against the demand is confined to penalty & fine.
Considering the submissions made by learned counsel for the Petitioner that the Petitioner would prefer appeal before the appellate Tribunal after it is constituted, as an interim measure, it is directed that no coercive action shall be taken against the Petitioner during the pendency of the writ petition so far as the impugned demand is concerned.
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2023 (7) TMI 1534
Levy of service tax - royalty paid by the appellant to the Government of India - whether payment of royalty on mining of minerals i.e., petroleum or natural gas to the GoI-MoP&G can be considered as service or not, and whether it attracts payment of service tax? - HELD THAT:- This issue has arisen initially on the understanding of the Revenue on the basis of Circular No.179/5/2014-ST dated 24.09.2014, issued clarifying about the levy of service tax, inter alia, on taxable services received by a Joint Venture from its members or third party. It was stated therein that 'In the context of a JV project, cash calls are capital contributions made by the members of JV to the JV. If cash calls are merely a transaction in money, they are excluded from the definition of service provided in section 65B(44) of the Finance Act,1994. Whether a 'cash call' is 'merely... a transaction in money' [in terms of section 65B(44) of the Finance Act, 1994] and hence not in the nature of consideration for taxable service, would depend on the terms of the Joint Venture Agreement, which may vary from case to case. Payments made out of cash calls pooled by a JV, towards taxable services received from a member or a third party is in the nature of consideration and hence attracts service tax.'
From the above clarification issued by the Ministry of Finance, CBIC, which equally apply to the service tax in pre-GST regime, it is found that on the basis of this clarification alone the impugned order is not sustainable.
This Tribunal in the case of B.G. EXPLORATION & PRODUCTION INDIA LTD. VERSUS COMMISSIONER OF CGST & CEX., NAVI MUMBAI [2021 (10) TMI 306 - CESTAT MUMBAI] has considered a similar arrangement under another PSC between the Government of India and B.G. Exploration and Production India Ltd., ONGC and the appellant. We find that the this Tribunal had after taking note of the policy underlying the execution of the PSCs as also the terms and conditions of the same, concluded that the Government of India with the Appellant, RIL and ONGC had entered into a joint venture agreement, where under each co-venturer had its own set of obligations and the responsibility discharged by each of the co-venturers towards the venture which was not by way of any service rendered to the joint venture, but in their own interest in furtherance of the common objective of the joint venture. Thus it was held by the Tribunal that service tax liability, could not have been fastened upon the Appellant.
It is also found that in the appellant’s own case in M/S RELIANCE INDUSTRIES LIMITED VERSUS COMMISSIONER OF CGST & CENTRAL EXCISE, BELAPUR [2023 (4) TMI 921 - CESTAT MUMBAI] in respect of demand of service tax towards certain expenditure incurred by the appellants as ‘operator’ under the Joint Operating Agreement under the PSC, the issue had been decided in favour of the appellants.
Conclusion - The demand of service tax on royalty paid by the appellant to the Government of India do not sustain.
There are no merits in the impugned order passed by the learned Commissioner (Appeals) - appeal allowed.
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2023 (7) TMI 1533
Seeking direction to opposite party no.2 to unblock the Electronic Credit Ledger of the petitioner and to withdraw/recall all proceedings thereunder - HELD THAT:- When this Court made a querry as to whether the petitioner has taken any step for revocation of cancellation of its registration or not, no reply was forthcoming from the learned counsel for the petitioner. Therefore, the question of deposit of tax does not arise.
This Court is not inclined to entertain this writ petition and the same is dismissed.
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2023 (7) TMI 1532
Direction to respondents 1 to 5 to disburse the service tax, interest and penalty waiver - HELD THAT:- This Court is of the considered opinion that appropriate authority ought to consider and pass orders.
Hence, the 1st respondent are directed to consider the case of the petitioners therein and pass orders within a period of twelve weeks from the date of receipt of a copy of this order.
Petition allowed.
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2023 (7) TMI 1531
In the case before the Rajasthan High Court, presided over by Hon'ble Mr. Justice Inderjeet Singh, the petitioner, represented by Mr. R.D. Rastogi, ASG, argued against the jurisdiction of the National Company Law Tribunal (NCLT) Mumbai Bench regarding a matter under the Prevention of Money Laundering Act (PMLA). The petitioner cited precedents from the Delhi High Court (Rajiv Chakraberty Resolution Professional of EEIL Vs. Directorate of Enforcement, 2022 SCC Online DEL 3703) and the Madras High Court (Deputy Director, ED Vs. Asset Reconstruction Company, 2020 SCC Online MAD 28090) to support their position. The petitioner contended that the proceedings under the PMLA are pending before the PMLA Appellate Tribunal, which has already issued a status quo order concerning the disputed property. The petitioner also noted that a previous writ petition (D.B. Civil Writ Petition No. 18091/2019) was dismissed as withdrawn, and the respondents approached the NCLT Mumbai Bench without including the petitioner, despite the proceedings being registered in Jaipur. Consequently, the court issued a notice to the respondents, returnable in six weeks, and stayed the operation of the NCLT Mumbai order dated 24.02.2022 and any further proceedings related to it.
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2023 (7) TMI 1530
Money Laundering - provisional attachment order - invocation of Section 8(4) of PMLA 2002, not as a rule but as an exception - validity of notice - notice for possession has been issued without giving any exceptional reasons (for eviction) rather caused as a rule - violation of principles of natural justice - reliance placed in the of OPTO CIRCUIT INDIA LTD. VERSUS AXIS BANK & OTHERS [2021 (2) TMI 117 - SUPREME COURT] to emphasize that reasons needs to be given in the notice and cannot be supplemented.
Challenge to notice - HELD THAT:- The notice for possession has been questioned by the appellant even on the ground that no reason has been given therein, whereas administrative order should disclose the reason. The reference of the judgement of Apex Court in the case of OPTO Circuits (India) Ltd. v. Axis Bank has been given where it was held that the reasons for passing of an order shall be given therein and cannot be substituted - It is found that the order impugned therein was containing reasons but additional reasons were given before the court for the first time. Such a practice was not accepted. The case in hand is not of similar nature. In this case, there is no order under challenge but a notice under Section 8 (4) of the Act of 2002 which does not direct for giving reasons in the notice for possession. In fact, the provision aforesaid allow possession of the property forthwith on passing order of confirmation of provisional attachment order.
The stage for taking possession comes forthwith on the confirmation of order of provisional attachment and it does not mandate assignment of reasons therein for causing possession. The notice otherwise does not require a reply from the effected person so as to assign the reasons for its reply. The appellants have failed to make a differentiation between the administrative order and the notice under the statute not requiring assessment of reasons for taking possession - In fact, it is in view of the judgement of Apex Court in the case of Vijay Madanlal Choudhary [2022 (7) TMI 1316 - SUPREME COURT (LB)] that provision of Section 8 (4) cannot be invoked as a course but as an exception. The said judgment does not mandate assignment of the reason in the notice itself. What has been ruled is that the possession should not be sought as a course but as an exception. In such circumstance notice was not required to contain the reason for taking possession of the attached property. The reasons can be supplied by the respondents as and when the notice is questioned by the aggrieved party.
Confirmation of provisional attachment order - HELD THAT:- The possession of the property may be taken at the stage of confiscation but in the case of exceptional nature, it can be after confirmation of provisional attachment order. On strictly going by the Section 8 (4), the right of the respondents to invoke aforesaid provision comes in existence forthwith upon confirmation of the provisional attachment order. The statutory provision cannot be ignored, even by the court. In fact, possession at the stage of confiscation of the property remains automatic because on confiscation of the property, it vests in the government and would be along with the possession and therefore, Section 8 (4) was brought on the statute to allow possession of the property even prior to confiscation and the said provision has been upheld by Apex Court where its constitutional validity was challenged. Once the provision is held to be constitutionally valid, a view contrary or offending the statutory provision cannot be taken. Thus, the appellant cannot be agreed that possession of the property can be taken only on confiscation. It would be rewriting Section 8 (4) of the Act though possession after confirmation of the provisional attachment order would not be as a rule but an exception.
What would be an exception? - HELD THAT:- The principle established is that possession post-confirmation of provisional attachment is permissible as an exception, provided exceptional reasons are demonstrated - The present case being a case of organised crime, the exception exist to invoke Section 8 (4) to take possession of the property.
Conduct of the appellant - HELD THAT:- As per the statement made by them, the purchase of the property is shown to be out the funds earned in cash and not out of the proceeds of crime. It is stated that whatever fund was taken from ABG International Pvt. Ltd., was not out of the bank loan taken by ABG Shipyard Ltd., but out of their own earnings in cash. The fact could not be substantiated and, further with regard to the loan amount said to have been re-paid to the company through a notarized assignment deed, it is stated by the Notary that there is no entry of the said document in the register and that it bears an odd no. 12-A which can happen only in a case of interpolation. The respondents have successfully shown that even the alleged re-payment through the assignment deed is out of the funds of associated companies of ABG Shipyard by routing the proceeds of crime and not after taking loan from the bank or earning for its re-payment.
Conclusion - The money trail is enough to show that the proceeds of crime was diverted for purchase of property in question and thereby the flat no. 4-C was purchased out of the proceeds of crime. The possession of the attached property should not be taken by invoking Section 8(4) of the Act of 2002 as a rule but can be as an exception. The appellant's application for an interim order dismissed - The notice for possession upheld.
Application dismissed.
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9911796707
