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2005 DIGILAW 467 (PNJ)

Maharashtra Agro Pvt. Ltd. v. State Of Haryana

2005-03-31

D.K.JAIN, HEMANT GUPTA

body2005
Judgment Hemant Gupta, J. 1. The petitioner has invoked the jurisdiction of this Court under Article 226/227 of the Constitution of India for the issuance of a writ in the nature of mandamus directing the respondents No. 2 and 3 to allow the petitioner to continue his business and to reopen the factory premises forthwith. 2. Respondent No. 4 M/s Growell Agri Products Pvt. Ltd. was running a factory at Plot No. W-25 in the Old Industrial Area Bahadurgarh. Respondent No. 4 sold the land, building, plant and Machinery to the petitioner vide registered sale deed dated 27.9.2004. However, before the sale was effected by the said respondent, an order of assessment under Haryana Local Area Development Tax Act, 2000 (hereinafter referred to as the LADT Act) was passed on 19.3.2004 whereby a s urn of Rs. 3,06,408/- was found as a tax due payable by respondent No. 4. On account of the failure of respondent No. 4 to discharge the said liability, a notice dated 20.8.2004 was issued by the Assistant Collector, Excise and Taxation First Grade calling upon respondent No. 4 to pay a sum of Rs. 3,06,408/- on or before 31.8.2004 failing which recovery was contemplated to be made by way of arrest warrant and attachment. Subsequently, warrant of attachment in terms of Section 72 of the Punjab Land Revenue Act, 1887 was issued on 17.9.2004. Vide another communication dated 20.9.2004, the respondent No. 4 was informed that plot No. E-25 Old Industrial Area, Bahadurgarh has been attached and that respondent No. 4 is not permitted to transfer the plot or resale without clearing the arrears. Since the entire arrears was not paid, the respondent took over the Management of the factory of the petitioner on 13.12.2004. 3. The entire amount of arrears of tax in pursuance of which attachment was effected amounting to Rs. 3,06,408/- was deposited on 11.1.2005 and there was no arrears against the said demand. Since the entire amount of arrears was deposited, a representation was made by the petitioner on 18.1.2005 to vacate the order of attachment dated 17.9.2004. Since the respondent failed to hand over the possession, the petitioner invoked the jurisdiction of this Court. 4. It is the stand of the respondents that additional demand of Rs. 7,78,936/- is still pending against respondent No. 4 created in the year 2000-2001, 2001-2002 and 2002-2003 under the LADT Act. Since the respondent failed to hand over the possession, the petitioner invoked the jurisdiction of this Court. 4. It is the stand of the respondents that additional demand of Rs. 7,78,936/- is still pending against respondent No. 4 created in the year 2000-2001, 2001-2002 and 2002-2003 under the LADT Act. It was also stated that the assessment for the year 2003-2004 and 2004-2005 under the Haryana Value Added Tax Act, 2003 and Central Sales Tax Act, 1956 and Haryana Local Area Development Act, 2000 are still pending and additional demand is likely to be created. It was thus pleaded that the transfer of immovable property with the intention of defrauding the State of any tax or other due is void against any claim in respect of any tax or any dues payable in terms of Section 9(4) of the Haryana Local Area Development Act, 2000. It was denied that the order of attachment was with regard to an amount of Rs. 3,06,408/-. It was pleaded that since the demand pending against respondent No. 4, therefore, the petitioner itself is responsible for the loss as alleged as he could not have purchased the property in dispute knowing well that the amount was outstanding and recoverable from respondent No. 4. 5. The petitioner controverted the stand of the respondents by filing replication. It was pointed out that an amount of Rs. 7,78,936/- is the amount towards the interest which has been stayed in separate appeals subject to furnishing of surety bonds. It was also pleaded that respondent No. 4 has paid tax according to the returns under the LADT Act for the year 2003-2004 and 2004-2005. The petitioner has attached the details of payment along with replication as Annexure P-35. 6. It is the admitted that fact that the amount of Rs. 7,78,936/- due and payable by respondent No. 4 is in fact an amount of interest payable in terms of the provisions of the LADT Act. It is also admitted fact that levy of taxes under the Haryana Local Area Development Act , 2000 is subject-matter of appeal before the Hon ble Supreme Court and that there is an order of stay of interest payable on the arrears of such tax. It is also admitted fact that levy of taxes under the Haryana Local Area Development Act , 2000 is subject-matter of appeal before the Hon ble Supreme Court and that there is an order of stay of interest payable on the arrears of such tax. It is also not disputed that no proceedings on behalf of either the petitioner or respondent No. 4 challenging the claim of interest under the aforesaid Act is pending before the Hon ble Supreme Court. Still further, the assessment under the Haryana Value Added Tax Act, 2003 and Central Sales Tax Act in respect of the years 2003-2004 and 2004-2005 are yet to be finalised. 7. The learned counsel for the petitioner has vehemently argued that the attachment was effected in pursuance of an order of assessment dated 19.3.2004 in respect of which summons were issued on 27.8.2004 specifying a sum of Rs. 3,06,408/- as amount due and payable by respondent No. 4. Therefore, the subsequent order of attachment is in fact in respect of the said amount though the order of attachment may not contain the amount due and payable by respondent No. 4. It is contended that once such an amount is paid, then in terms of Section 72(4) of the Punjab Land Revenue Act, 1887 read with Section 66 thereof, the attachment and the management of the company taken over by the respondents cannot subsist. On the other hand it is the stand of the respondents that the order of attachment Annexure P-18/A and P-18 is in respect of the entire arrears, therefore, such arrears will include not only the arrears due on the said date but also the amount falling due subsequently. 8. On 17.9.2004, the order of attachment was issued on account of non-payment of arrears under the LADT Act amounting to Rs. 3,06,408/-. The fact, no other amount was even computed and demand raised against respondent No. 4 on the said date. It is the amount of Rs. 3,06,408/- which was the only amount in default. Under Section 66 of the Punjab Land Revenue Act, 1887 a statement of account certified by a revenue official is considered to be proof of the existence of arrears of land revenue of its amount and of the person who is the defaulter. On 17.9.2004 the amount of Rs. 3,06,408/- which was the only amount in default. Under Section 66 of the Punjab Land Revenue Act, 1887 a statement of account certified by a revenue official is considered to be proof of the existence of arrears of land revenue of its amount and of the person who is the defaulter. On 17.9.2004 the amount of Rs. 3,06,408/- was the amount certified by the Assistant Collector as the amount of arrears of land revenue and that respondent No. 4 is a defaulter. Therefore, in terms of sub Section (4) of Section 72 of the Act, the land could not remain under attachment after the said arrears stood discharged. 9. The arrears amounting to Rs. 3,06,408/- were discharged on 11.1.2005. Thereafter, the petitioner had made representation on 18.1.2005 for revocation of the order of attachment. Once the amount of arrears as certified by the Assistant Collector stood paid, the respondents were duty bound to revoke the attachment and hand over the management of the assets to the persons entitled thereto forthwith. The continuance of management with the respondents in view of non-payment of interest amount quantified after the order of attachment is not justified as such amount was not demanded in terms of Section 66 of the Punjab Land Revenue Act, 1887. The management was taken over only for the reason that the amount of Rs. 3,06,408/- was in arrears. There is no order of attachment on account of non-payment of arrears of any other kind. Therefore, we are satisfied that the action of the respondents in not revoking the attachment and handing over the management of the company to the persons entitled is not justified in law after the arrears in respect of which attachment was effected, stands paid. 10. Before parting, we may notice that counsel for the petitioner has undertaken that the petitioner shall not dispose of any of the assets of the company for a period of 2 years during which period the respondents can frame assessment under the relevant provisions of law. The petitioner shall remain bound by such undertaking given during the course of hearing before this Court. 11. The petitioner shall remain bound by such undertaking given during the course of hearing before this Court. 11. In view of above, we allow the present writ petition and direct the respondents to revoke the attachment of the immovable property including plant and machinery situated at Plot No. E-25, Old Industrial area, Bahadurgarh and hand over the management thereof to the petitioner in accordance with the law forthwith.