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TMI Blog2013 (7) TMI 217X X X X Extracts X X X X X X X X Extracts X X X X ..... conclude that they were the ‘plant and machinery’ which were sold to and handed over to the auction purchaser in February 2007. In other words, there is nothing to verify that the goods which have been sold by auction sale in 2007 were in fact the very goods that were confiscated by the Customs Department in 1997. This Court is not inclined to entertain the prayer of the Customs Department for cancellation of the auction sale and return of the auction goods to the Customs Department. Correspondingly, petition filed by the auction purchaser is allowed. The auction purchaser is permitted to further sell the plant and machinery purchased by him in the auction sale and hand over possession thereof to the purchaser. - Co. Petition No. 183 of 2001 & C.A. Nos. 910 & 1297 of 2008 - - - Dated:- 26-4-2013 - S. Muralidhar, J. For the Appellant : Satish Aggarwala, Ms.Khushboo Garg, Rajeev Kumar, Sangram Patnaik and Mayank Goel . ORDER:- CA Nos. 910 of 2008 1297 of 2008 1. CA No. 910 of 2008 has been filed by the Customs Department seeking the setting aside of the auction sale of the capital goods and raw materials belonging to Yuil Measures India Limited ( YMIL ) (th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... luding EMD) will be deposited with the O.L. within seven days and the balance 75% of the bid amount will be deposited within 60 days. 4. The auction purchaser will not be liable to pay the electricity dues, telephone charges and dues of NSEZ for the period prior to the date of auction. 5. The auction purchaser is at liberty to pay the entire bid amount earlier. After entire payment is made, possession of the property will be given to the auction purchaser. 6. Auction purchaser will be entitled to employ security outside the property. However, possession of the property as already stated above will be given only after full payment is made. 7. The O.L. will publish citations in the newspapers Amar Ujala and Dainik Jagran inviting claims from the workers. Needful will be done within four weeks from today. List on 1st February 2007. Dasti. 6. On 18th January 2007, the OL informed the Court that Mr. Vilas Gupta had deposited the full amount. 7. Even while the claims of workers and creditors were being processed by the OL, the Customs Department filed CA No. 910 of 2008 on 15th July 2008. After a show cause notice was issued to YMIL, an order was passed by the Commis ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sion of the plant and machinery nor any inventory was given by the Office of the Ld. Official Liquidator. 10. Mr. Vilas Gupta pointed out in his reply that he had paid Rs. 1,07,85, 962.25 for the building and Rs. 27,64,037.75 for the plant and machinery of YMIL. He asserted that he was a bonafide purchaser of the plant and machinery which in any event was of no use to him and had only scrap value. It was stated by Mr. Vilas Gupta in para 12 of his reply that he wrote to the Deputy Commissioner of Customs, NSEZ on 2nd September 2008 for permission to dispose of the plant and machinery. A copy of the said letter was enclosed. It is stated that the Deputy Commissioner of Customs did not respond to the said letter. In para 15 of his reply Mr. Vilas Gupta stated that he was ready and willing to return the plant and machinery if he is returned the amount of Rs.27,64,037.75. Mr. Vilas Gupta also filed CA No. 1257 of 2008 on 22nd November 2005 praying inter alia for confirmation of the sale in his favour and in the alternative for a direction to the OL to refund him the sum of Rs.27,64,037.75. 11. The fact of payment of the sums by Mr. Vilas Gupta and his being given possession of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... been sold in an auction conducted by this Court for a sum of Rs. 27,64,037.75. In the event the capital goods and raw material tally with the goods confiscated by the Customs Department, this Court would be inclined to either return the aforesaid capital goods and raw material to the Customs Department or direct the secured creditors to pay the auctioned price of Rs. 27,64,037.75 to the Customs Department. The Customs Department is directed to inform this Court about its stand within two weeks. This Court may also indicate that in the event the auction conducted by this Court is set aside or the secured creditors are directed to refund the amount to the Customs Departments, this Court would be inclined to impose costs on the Customs Department as it did not intimate the Court prior to the confirmation of the auction that goods had been confiscated by it. List on 27th February 2012. Order dasti under signatures of Court Master to all parties. Co. Pet. No. 1016 of 2008 Present application has been filed by the Customs Department for stay of auction. Admittedly, present application has become infructuous. Accordingly, the application is dismissed. 13. After grant of t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d counsel for the Official Liquidator; submission being that in this communication the Official Liquidator has admitted the claim of the Custom Department at Rs. 5,12,93,822. This discrepancy should be answered by the Official Liquidator in the fresh status report to be filed by him. Counsel for the Custom Department will also take final instructions in terms of the earlier orders of this Court. Co. Pet. No. 183 of 2001 Renotify for 21st January 2013. 15. Consequent to the above order, a fresh status report was filed by the OL and the following order was passed on 21st January 2013: Status Report No.59 of 2013 1. A copy of status report No.59 of 2013 of the Official Liquidator ( OL ) has been handed over to Mr. Satish Aggarwala, learned counsel for the Customs Department. It is, inter alia, stated in the report that the claim of the Deputy Commissioner, Customs, Noida Special Economic Zone, Noida is admitted for a sum of Rs. 5,12,93,822 as preferential creditor, subject to verification from the originals and the company records. The fund position as on 31st December 2012 of the Respondent Company in liquidation is Rs. 21,97,708. 2. The status report o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ent s prayer is belated and should not be entertained at a stage when from the auction sale proceeds the dues of the workmen and secured creditors has been paid pro rata strictly in terms of Section 529 A of the Act. Moreover, there was nothing produced by the Customs Department to show that the plant and machinery sold to the auction purchaser was no different from the capital goods and raw materials confiscated by it nearly ten years earlier. 19. The above submissions have been considered. The proceedings that took place before the Court from time to time reveal that the Customs Department was unable to produce before the Court any inventory of the goods of YMIL which was drawn up at the time of confiscation in 1997. This is critical for considering the plea of the Customs Department for cancellation of the auction sale and return of the plant and machinery that was sold to the auction purchaser. What has been produced are B/Es and packing lists dated 1990 and 1991 regarding capital goods and raw materials . In the absence of any inventory prepared by the Customs Department at the time of confiscation in 1997 it is not possible to verify whether the capital goods descr ..... 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