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TMI Blog2013 (11) TMI 1000X X X X Extracts X X X X X X X X Extracts X X X X ..... ecurity deposit – Whether the Licensee was entitled to continue use of the Premises till the refund was made without being liable to pay any compensation – Held that:- It would not be appropriate to exercise the jurisdiction under Article 226 of the Constitution to enquire into a wholly disputed question in regard to the authenticity of the purported leave and licence agreement - The discrepancies to which a reference has been made earlier only indicate to the Court that in a matter which involves a dispute in regard to the authenticity of the document, it would not be appropriate for this Court under Article 226 to determine whether the document which is produced on the record is infact genuine. Petitioners are in use and occupation of the residential flat - As the material on the record would indicate, the use and occupation of the Petitioners as been to the knowledge of the Customs Authorities right at least from July, 1998 - It has not been necessary for the Court to consider the legitimacy of the attachment notice that was levied by the Customs Authorities - it is a matter of some significance that the Seventh Respondent as the owner of the residential flat has consciously ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... with interest. 2. Admittedly, the alleged licence agreement was not renewed after the expiry of the original term on 17 May, 1998. 3. The premises of the residential flat were attached on 19 June, 1998 by the Customs Authorities for the recovery of amounts due and payable under Rule 5 of the Customs (Attachment of Property of Defaulters for Recovery of Government Dues) Rules, 1995. According to the Customs Authorities a person by the name of Naval Kishore Bangard had fraudulently claimed a duty drawback of an amount approximately of Rs. 50 Crores without actually exporting any goods and had received the drawback in the name of his concerns or those of his family viz. M/s. Om Traders, M/s. Prime Agricom and M/s. Tropical Exotics. N.K. Bangard was one of the two partners of Om Traders, while his wife was stated to be the sole proprietor of Prime Agricom and Tropical Exotics. According to the Customs Authorities, during the course of the investigation N.K. Bangard, in a statement under Section 108 of the Customs Act, 1962 confirmed that he was actually managing the three firms and that he had committed a fraud by submitting forged drawback documents in the total sum of Rs. 50.14 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... en attached on 19 June, 1998 and calling upon the predecessor-in-interest of the First Petitioner to vacate the premises by 30 April, 1999. On 25 March, 1999 the Petitioners by their reply stated that they have furnished a security deposit of Rs. 30 lacs and since the flat had been attached, they would seek an assurance of a refund of the security deposit. In the meantime, it was stated that the licence fees have been continued to be paid to the Customs Department. On 12 April, 1999 the Assistant Commissioner of Customs called upon Birla Global Finance to vacate the premises forthwith in response to which a communication was addressed on 16 April, 1999 adverting to the licence agreement and the payment of the security deposit in the amount of Rs. 30 lacs. 5. A writ petition under Article 226 of the Constitution was filed by the Petitioners being Writ Petition 1759 of 1999 seeking to challenge the notices issued by the Assistant Commissioner of Customs on 11 March, 1999 and 12 April, 1999 requiring the Petitioners to handover vacant possession. The Petition was disposed of by a Division Bench of this Court by an order dated 22 September, 1999, in the following terms : learned c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... h a copy of the lease deed, particulars of payment towards licence fees and other documents. The Petitioners have claimed that on 23 June, 2011 they received a copy of a letter from Deputy Commissioner of Customs (Exhibit X) where the department reiterated that only the deposit would be advertised as an encumbrance while issuing the auction notice. Thereafter correspondence has been exchanged between the Petitioners and the Customs Authorities. The Petitioners have reiterated their entitlement to the refund of the security deposit of Rs. 30 lacs together with interest. On the other hand, the Customs Authorities have called upon the Petitioners to vacate the premises on the basis that the flat was to be auctioned. In the month of May, 2012 the pay orders furnished by the Petitioners for the payment of monthly compensation and parking charges for the month of April, 2012 were returned. On 10 August 2012, the Deputy Commissioner of Customs issued an order and called upon the Petitioners to vacate the flat. Eventually an auction notice was issued on 6 September, 2012 for the sale of the residential flat. The Petitioners were informed on 3 September, 2012 of the auction and were called ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lat would have to be protected. 8. On the other hand, it has been urged on behalf of the Respondents that : (i) The original leave and licence agreement is admittedly not forthcoming. Though the Customs Authorities have repeatedly called upon the Petitioners to produce the leave and licence agreement, the original has not been produced, though clause 21 of the purported deed of licence specifies that the licensee was to retain the original. The genuineness and authenticity of the document is seriously in doubt; (ii) There are several other contemporaneous circumstances which cast grave doubt on the authenticity of the alleged deed of licence. These including the fact that the typed copy of the document which was produced along with the petition contains a reference to the payment of the security deposit being made on 18 January, 1997, which would be much prior to the execution of the licence on 18 June, 1997. Similarly, the receipt which was produced earlier is of 18 January, 1997. However, the photocopy of the licence deed which has been produced in a subsequent affidavit reflects that the payment has been made on 18 June, 1997 and even the cheque number does not tally ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Central Government . If the amount remains unpaid for a period of thirty days, the proper officer is empowered to cause the property to be sold. The proceeds of the sale can be utilized to satisfy the amount payable, while the surplus, if any, is to be returned to such person. Under Section 142A notwithstanding anything to the contrary contained in any Central Act or State Act, any amount of duty, penalty, interest or any other sum payable by an assessee shall constitute a first charge on the property of the assessee. The only exception is as otherwise provided in Section 529A of the Companies Act, 1956, the Recovery of Debts Due to Banks and the Financial Institutions Act, 1993 and the Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002. 10. In pursuance of the powers conferred by Section 142, the Central Government has framed the Customs (Attachment of Property of Defaulters for Recovery of Government Dues) Rules, 1995. Rule 3 provides for the issuance of a certificate where Government dues are not paid by any defaulter. Under Rule 4, on receipt of a certificate a notice is required to be served on the defaulter calling upon him ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the learned Senior Counsel appearing on behalf of the Petitioners that the Petitioners do not have an original of the licence agreement. The receipt clause that is mentioned in the typed copy of the agreement at Exhibit A to the petition states that an amount of Rs. 30 lacs was paid by cheque No. 023928, dated 18 January, 1997 drawn on Citibank. Apart from this, the photocopy of the receipt which was produced by the Petitioners advocate on 6 December, 2010 (Exhibit S) shows a payment of the security deposit by the same cheque dated 18 January, 1997 (cheque No. 023928 drawn on Citibank). However, in a subsequent affidavit that has been filed in these proceedings on 1 October, 2012 a photocopy of the leave and licence agreement has been produced. The receipt clause contained in the agreement refers to a payment of Rs. 30 lacs by a cheque dated 18 June, 1997 bearing No. 723928 drawn on Citibank. The Petitioners have also relied upon a payment voucher, a photocopy of the cheque and a bank statement (which however is not certified). Counsel appearing on behalf of the Revenue has in these circumstances submitted that it would be inappropriate for this Court in the exercise of its jurisd ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... horities. Merely addressing letters to the Petitioners to vacate the premises would not constitute due process of law. In view of the fact that the Petitioners are in use and occupation of the residential flat, it will be necessary for the Court to direct that they shall not be deprived of the use and occupation of the flat unless and until the Customs Authorities take recourse to due process of law. The Deputy Commissioner of Customs has not exercised any statutory power which enables him to pass an order of eviction. 15. In the view which we have taken, it has not been necessary for the Court to consider the legitimacy of the attachment notice that was levied by the Customs Authorities. We decline to undertake that exercise at the behest of the Petitioners. Above all, it is a matter of some significance that the Seventh Respondent as the owner of the residential flat has consciously refrained from challenging the attachment notice that was levied by the Customs Authorities. We are, therefore, not inclined to entertain that challenge at the behest of the Petitioners, particularly when the licence agreement upon which the Petitioners rely is a wholly disputed document. 16. In t ..... X X X X Extracts X X X X X X X X Extracts X X X X
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