Case Law Details
S. Pushpa Vs Official Liquidator (Madras High Court)
Introduction: This writ petition delves into the legal intricacies surrounding a property in Salem, as the petitioner strives for the de-sealing of their property at Bharathi Street. The conflict arises from the erroneous actions taken during the liquidation of M/s. Swathy Smart Card, the third respondent, which led to the sealing of the petitioner’s property.
Detailed Analysis: The petitioner, claiming ownership of the contested property, leased it to M/s. Swathy Smart Card. Following the petitioner’s acquisition of the property, the third respondent continued the lease. However, due to the third respondent’s liquidation, the Official Liquidator sealed the property. The petitioner, asserting rightful ownership, submitted a representation on 04.01.2022, urging respondents 1 and 2 to de-seal the property.
Mrs. P. Rajalakshmi, counsel for the petitioner, argues that an erroneous inclusion of the property in the third respondent’s assets occurred during an Income Tax Department check. Despite the petitioner’s plea, the property remains sealed, with the Official Liquidator in possession since 2016. The petitioner’s representation has gone unanswered, prompting this writ petition.
The Deputy Official Liquidator concedes the mistake, acknowledging that the property indeed belongs to the petitioner. Assurance is given for the vacation of the premises, but a request for sufficient time is made.
Conclusion: In the resolution, the court directs the first respondent to consider the petitioner’s representation and issue orders for the de-sealing of the property. A 30-day timeframe is provided for the Official Liquidator to vacate the premises, returning all relevant materials. The second respondent, the Assistant Commissioner of Income Tax, is deemed irrelevant to the petitioner’s plea.
FULL TEXT OF THE JUDGMENT/ORDER OF MADRAS HIGH COURT
This Writ Petition is filed seeking for issuance of mandamus directing the respondents 1 and 2 to consider the petitioner’s representation dated 04.01.2022 and to de-seal the property situated at S.No.97/5B,R.S.No.97/B 20 in Plot No.1, Bharathi Street, Swarnapuri Colony, Salem -4.
2. The case of the petitioner is that the petitioner is the owner of the aforesaid property. The petitioner’s erstwhile owner leased out the property to the third respondent, M/s. Swathy Smart Card and subsequent to the purchase of the said property by the petitioner, the third respondent continued the lease with the petitioner and was in possession of the property by paying rent to the petitioner. Since the third respondent-Company was under liquidation, liquidation proceedings were initiated against the third respondent-Company and the Official Liquidator sealed the property. The petitioner being the owner of the property made a representation dated 04.01.2022 to the respondents 1 and 2 setting out fact that place/property, where, the third respondent-Company run the business, is the petitioner’s property and therefore, sought to de-seal the property. Since the said representation evoked no response, the petitioner has filed the present Writ Petition seeking for aforesaid prayer.
3. Mrs. P. Rajalakshmi, learned counsel appearing for the petitioner would submit that the petitioner is the owner of the property, however, pursuant to a check conducted by the Income Tax Department, all the books of accounts, statutory registers, returns and other records have been taken over by the Officials attached to Income Tax Department, and the Income Tax Officials while preparing the inventories, wrongly included the petitioner’s property in the list of assets of the third respondent, and the Official Liquidator, pursuant to liquidation proceedings initiated against the third respondent-Company, took possession of the Company’s assets, both movable and immovable and without verifying the title over the property, wrongly sealed the property, which belonged to the petitioner. Aggrieved over the same, the petitioner made a representation dated 04.01.2022 to the respondents 1 and 2 to de-seal the property, however, the respondents has not considered the said representation so far, which necessitated the petitioner to file this Writ Petition. Therefore, the learned counsel prayed that appropriate direction may be issued to the respondents 1 and 2 to consider the said representation of the petitioner and to de-seal the petitioner’s property forthwith, since the Official Liquidator is in possession of the property from 2016 onwards without even paying any single pie to the petitioner towards rent.
4. The Deputy Official Liquidator appearing for first respondent would fairly submit that since the Company conducted by the third respondent in the petitioner’s premises went under liquidation, the first respondent, Official Liquidator in the process of seizure of the assets of the third respondent-Company, both movable and immovables, locked and sealed the property, under an impression that the property also belongs to the third respondent, however, upon verification of records, it is found that the property belongs to the petitioner. Hence, Deputy Official Liquidator assured that the Official Liquidator would vacate the premises, however, requested for granting sufficient time.
5. Heard the learned counsel for the petitioner and respondents.
6. As far as second respondent, Assistant Commissioner of Income Tax is concerned, since it appears that pursuant to a check conducted by the Income Tax Officials at the premises of the third respondent-Company, the certain books of accounts and all other documents of the third respondent-Company were seizeed; that the Official Liquidator, in pursuance of the proceedings initiated against the third respondent-Company is need of such documents, which were in the custody of Income Tax Official and has sent notice dated 17.03.2021 to the Assistant Commissioner of Income Tax, for providing those documents, the said Income Tax Official has been impleaded as one of the party respondent in this Writ Proceedings, this Court is of the view that it would be suffice to direct the first respondent to vacate the property, inasmuch as, the second respondent has no role to play in regard to the prayer made by the petitioner.
7. Accordingly, this Writ Petition is disposed of with a direction to the first respondent to consider the representation made by the petitioner, dated 04.01.2022 and to pass orders for de-seal of the property. The first respondent is also directed to take back all books of accounts, equipments, if any, that were kept lying in the premises and vacate and hand over vacant premises within a period of 30 days from the date of receipt of a copy of this order. No costs.
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