Judgment 1. TRN & Sons at Chidambaram, in Cuddalore District, is a Financial Establishment in terms of Section 2(3) of the Tamil Nadu Protection of Interests of Depositors (In Financial Establishments), Act 1997 (hereinafter referred to as, 'the Act'). The said financial establishment collected huge deposits from public. Finally, the said establishment failed to repay the said deposits with interests as assured. Therefore, the depositors made complaints to the police. Based on the same, a case in Crime No.4 of 2004 under Section 420 of IPC and Section 5 of TNPID Act was registered by the Economic Offences Wing Police at Cuddalore. Totally, there were as many as eight accused in the said case. 2. During the investigation of the case, the Inspector General of Police, Economic Offences Wing-II, Chennai submitted a letter to the Government in C1/9411/Economic Offences Wing/2006, dated 20.4.2007, requesting the Government to attach the properties belonging to the partners of the said Establishment since the properties in the name of the establishment would not be sufficient to meet the demands. Having considered the same, the Government issued G.O.Ms.No.1461, Home (Police-19) Department, dated 17.10.2007 attaching as many as 19 properties by way of an order of interim attachment under Section 3 of the Act. Though the said order was passed on 17.10.2007 as required under Section 4(3) of the Act, the competent authority, namely, the District Revenue Officer, Cuddalore, did not make any application to the Special Court seeking to make the interim order of attachment as absolute. While so, the petitioners filed this Writ Petition seeking to quash the said Government Order in G.O.Ms.No.1461 dated 17.10.2007. On admitting the Writ Petition, this Court granted an interim order, directing the respondents not to disturb the possession of the petitioners. The said order came to be passed on 16.12.2007. According to the respondents, in view of the said interim order of this Court, no further application was made under Section 4 of the Act. 3. Subsequently, on completing the investigation, the Inspector of Police, Economic Offences Wing, filed a final report before the Special Court upon which the learned Judge has taken cognizance in C.C.No.47/2006. In the said final report, 8 persons are arrayed as accused including these two petitioners. 4. Before the learned Judge, the petitioners filed a petition seeking discharge from the said case. In the said final report, 8 persons are arrayed as accused including these two petitioners. 4. Before the learned Judge, the petitioners filed a petition seeking discharge from the said case. The said petition in Crl.M.P.No.5851/2007 was dismissed by the Special Court by order dated 19.5.2009. Challenging the same, the petitioners filed Revisions before this Court in Crl.R.C.Nos.591 and 1041 of 2009. By order dated 4.8.2009, Crl.R.C.No.591/2009 was allowed and by order dated 1.2.2011 Crl.R.C.1041 was allowed by this Court thereby discharging these two petitioners from the case. As against the said discharge order passed in favour of the 2nd petitioner, the State went on Special Leave Appeal to the Honourable Supreme Court in SLP (Crl. M.P.) No.20243/2009. The same was dismissed by the Hon'ble Supreme Court on 1.2.2010. Thus, the case against the rest of the accused alone is still pending trial before the learned Special Judge. 5. In view of the above development, now the petitioners would contend that the properties which are subject matters of the Government Order impugned in this Writ Petition are liable to be returned to the petitioners as the attachment order is no more valid. 6. A detailed counter has been filed by the competent authority, namely, the District Revenue Officer/2nd respondent herein. In the counter, inter alia, it is stated that no application was filed under Section 4 of the Act because of the interim order passed by this Court on 6.12.2007 in this Writ Petition. Referring to the counter, the learned Special Government Pleader would submit that in terms of Sections 3 and 4 of the Act, these properties are liable to be kept under attachment and they cannot be released at all. He would point out that out of 16 items of the properties covered in the Government Order, the petitioners claim right over items 4, 5 to 12, 14 and 15. The learned Special Government Pleader would further submit that so far as item No.4 is concerned, this property stands in the name of the 2nd petitioner Prasanna Devi who is not a member of the joint family. So far as the other properties are concerned, some of the properties stand in the name of Natarajan Pillai, the father of the 1st petitioner and Balasundaram and other properties stand jointly in the name of the 1st petitioner and Balasundaram. So far as the other properties are concerned, some of the properties stand in the name of Natarajan Pillai, the father of the 1st petitioner and Balasundaram and other properties stand jointly in the name of the 1st petitioner and Balasundaram. Therefore, so far as these properties are concerned, the attachment cannot be raised. 7. I have considered the above submissions. 8. Before going into the facts of the case, let us have a cursory look into Section 3 of the Act which reads as follows: "3. Attachment of properties on default of return of deposits — Notwithstanding anything contained in any other law for the time being in force— (i) where upon complaints received from a number of depositors, that any Financial Establishment defaults the return of deposits after maturity, or fails to pay interest on deposit or fails to provide the service for which deposit has been made, or (ii) where the Government have reason to believe that any Financial Establishment is acting in a calculated manner with an intention to defraud the depositors, and if the Government are satisfied that such Financial Establishment is not likely to return the deposits, or to make payment of interest or to provide the service, the Government may, in order to protect the interests of the depositors of such Financial Establishment, pass an ad-interim order attaching the money or other property alleged to have been procured either in the name of the Financial Establishment or in the name of any other person from and out of the deposits collected by the Financial Establishment, or if it transpires that such money or other property is not available for attachment or not sufficient for repayment of the deposits, such other property of the said Financial Establishment or a person who has borrowed money from the Financial Establishment to the extent of his default or, such other properties of that person in whose name properties were purchased from and out of the deposits collected by the Financial Establishment, as the Government may think fit, and transfer the control over the said money or property to the Competent Authority." Section 3(ii) of the Act deals with 3 kinds of properties. The first set of properties are the properties in the name of financial establishment. The first set of properties are the properties in the name of financial establishment. With a view to recover the amount from the financial establishment, the properties standing in the name of the financial establishment should be first of all attached. For any reason, if it is found that the said properties would not be sufficient to meet the demands, then, the Government and the competent authority may proceed against the properties standing in the name of the promoter, partner, director, manager, member of the said financial establishment or a person who has borrowed money from the financial establishment to the extent of his default. The third category of properties are the properties purchased from and out of the deposits collected by the financial establishment. 9. In the case on hand, admittedly, the properties in question do not stand in the name of the financial establishment. In the discharge petition, this Court as well as the Hon'ble Supreme Court have categorically held that the petitioners are neither partners nor promoters and they have got nothing to do with the said establishment. Therefore, the individual properties of these petitioners cannot be attached. The third set of properties are properties which could be purchased out of the deposits collected from the public. In the case on hand, it is not at all the case of the respondents that any of these properties was purchased out of the amount collected from the public. From the dates of purchase of these properties, it could be seen that these properties were purchased long before even the establishment of the financial establishment. Therefore, these properties cannot be attached as they do not fall within the category of properties mentioned in Section 3(i) of the Act. 10. But, it could be seen that items 4 to 12 stand in the name of one Nataraja pillai who was the father of the petitioner and one Balasundaram. Mr. Balasundaram was the Financier and the Managing Director of the Financial Establishment. As it is crystal clear that in respect of items 5 to 12, Balasundaram has got undivided share which can be proceeded with. But, at the same time, it should be made clear that in respect of the undivided share of the 1st petitioner in these items, there can be no attachment and there can be no further proceedings. As it is crystal clear that in respect of items 5 to 12, Balasundaram has got undivided share which can be proceeded with. But, at the same time, it should be made clear that in respect of the undivided share of the 1st petitioner in these items, there can be no attachment and there can be no further proceedings. Similarly, as far the items 14 and 15 are concerned, these two items are jointly in the name of the 1st petitioner, Balasundaram and one Sekar. Mr. Sekar is yet another accused in the case who is now facing prosecution. Therefore, so far as the undivided share of Balasundaram and Sekar/Gunasekar are concerned, there can be attachment and there can be further proceedings in respect of the same. But in respect of the undivided share of the 1st petitioner in this petition, there can be no attachment and there can be no further proceedings. 11. The learned Counsel for the petitioners would submit that the order of attachment passed by the Government under the Government Order has lost its life by expiry of the period as provided under 4(3) of the Act. A perusal of Section 4(3) of the Act would go a long way to show that after an order of interim attachment is made by the Government, within 30 days of the receipt of the same, it is obligatory on the part of the competent authority to make an application to the Special Court seeking to get the order of attachment absolute. But, in this case, admittedly, no such application was made within 30 days. For this, the only explanation offered by the learned Special Government Pleader is that though the Government Order was issued as early as on 17.10.2007, it was received by the competent authority only on 16.11.2007. Within 30 days from 16.11.2007, the competent authority should have been made an application before the Special Court. But, it was not done. There is no explanation offered as to why no such application was made before 16.12.2007. The learned Special Government Pleader would offer an explanation that since the interim order was passed by this Court on 6.12.2007 in this Writ Petition, no further proceedings could be initiated. 12. This explanation is not at all acceptable to this Court. There is no explanation offered as to why no such application was made before 16.12.2007. The learned Special Government Pleader would offer an explanation that since the interim order was passed by this Court on 6.12.2007 in this Writ Petition, no further proceedings could be initiated. 12. This explanation is not at all acceptable to this Court. The interim order passed by this Court is only to the limited extent that the possession should not be disturbed. This Court never restrained the competent authority from making an application to the Court. Assuming that the 2nd respondent was confused by the interim order passed by this Court and therefore, he did not make an application after 6.12.2007, there is no explanation as to why within 30 days from 16.11.2007, no application was made to the court. But, I do not want to nullify the entire Government Order on this ground, because, I am inclined to raise the attachment in respect of the properties against which the petitioners make claim in respect of their shares alone. In respect of the undivided share belonging to Balasundaram and other accused, since there is no challenge before this Court, I do not want to go into this question elaborately. 13. In view of the above position, I am inclined to allow the writ petition with the following directions: 1. The order of attachment passed under G.O.Ms.No.1461, Home (Police-19) Department, dated 17.10.2007 is set aside in respect of the item No.4 enumerated in the schedule to this Government Order; and 2. In respect of the items 5 to 12, 14 and 15, the Government Order stands set aside in respect of the undivided share of the 1st petitioner and in respect of the undivided share of the other sharers, the Government Order shall hold good and it is for the 2nd respondent to at least make an appropriate application within 30 days from today to the Special Court seeking to get the order of attachment absolute in respect of the undivided share of Balasundaram and Sekar @ Gunasekar. No costs.