Haridas Kundu vs Union Of India & Ors
2021 Latest Caselaw 5749 Cal

23.11.2021
    4
ns/pg Ct.16
                                  M.A.T. 241 of 2018
                                          With
                  I.A. CAN 1 of 2018 (Old CAN 1907 of 2018)
                                       With
                  I.A. CAN 2 of 2018 (Old CAN 1908 of 2018)



                                     Haridas Kundu.
                                           Vs.
                                 Union of India & ors.



               Mr. Vikas Singh        ...           for the appellant.

               Mr. N. C. Bihani,
               Ms. Papiya Banerjee Bihani ...        for the State.



                  Re: I.A. CAN 1 of 2018 (Old CAN 1907 of 2018)



                         This application has been filed to condone the

              delay of 129 days in filing the instant appeal.

                         We have heard Mr. Vikash Singh, learned

              counsel for the appellant and Mr. N. C. Bihani, learned

              counsel appearing for the respondents / State.

We are satisfied with the reasons assigned in

the affidavit filed in support of the application. The delay

in filing the instant appeal is condoned.

The application being I.A. CAN 1 of 2018 (Old

CAN 1907 of 2018) is allowed.

Re: MAT 241 of 2018

This appeal has been filed by the writ petitioner

being aggrieved by the judgment and order 13 th

September, 2017 passed in W.P. No.23127(W) of 2017.

The Division Bench on hearing the appeal under Section 5

of the Limitation Act, 1963 directed the application to be

taken up along with this appeal vide order dated 24 th May,

2021.

We have elaborately heard Mr. Vikash Singh,

learned counsel for the appellant and Mr. N. C. Bihani,

learned counsel appearing on behalf of the State /

respondent no.8. The appellant is a retired officer from

the Alloy Steel Plant, Durgapur. After his retirement in

April, 2007, he is said to have deposited his retiral

benefits in the State Bank of India, Mejhia Power Station

Branch. In May, 2007, he appears to have opened

another savings bank account with State Bank of India,

Nandanpur Branch and deposited a sum of Rs.1,50,000/-

in a term deposit with the said bank. Thereafter, in 2016,

he appears to have deposited Rs.5,00,000/- in the said

bank account. The bank account has been attached

pursuant to a certificate issued by the Securities and

Exchange Board of India, Eastern Regional Officer,

Kolkata (hereinafter referred to the "SEBI") vide a

certificate bearing no.1189 of 2017. Admittedly, the name

of the appellant does not find place in the said certificate

which has been issued under Section 28A of Securities

and Exchange Board of India Act, 1992 read with Section

222 of the Income Tax Act, 1961 (hereinafter referred to as

the "IT Act"). It is not in dispute that the name of the

appellant's son, namely, Mr. Budhan Chandra Kundu,

finds place in the certificate at serial no.10. The appellant

prayed for quashing the order of attachment and freezing

the bank accounts both, savings and term deposits, which

have been passed by the SEBI. The appellant approached

the writ Court contending that the bank has fraudulently

freezed the savings bank and term deposits account of the

appellant. Further, the appellant would contend that no

notice was issued to the appellant before issuing the order

of attachment of the bank accounts. Contending that the

action of the SEBI is illegal, the writ petition was filed.

The Learned Single Bench by order dated 13 th September,

2017 dismissed the writ petition directing the appellant to

avail the alternative remedy. Aggrieved by such order, the

appellant is before us.

We have elaborately heard Mr. Singh, learned

counsel for the appellant. We have also heard Mr. N. C.

Bihani, learned counsel for the State of West Bengal. The

learned counsel for the appellant submitted that the

power under Article 226 of the Constitution of India can

be exercised by this Court for issuing various categories of

writs and mere existence of an alternative remedy cannot

operate as a bar for entertaining the writ petition. The

contention advanced by the learned counsel for the

appellant is that in terms of sub-Section (3) (iii) of Section

226 of the IT Act, no copy of the notice ought to have been

forwarded to the appellant whose name admittedly did not

feature in the order passed by the SEBI freezing the bank

account. It is further submitted that in somewhat

identical circumstances, a learned Single Bench of the

High Court of Karnataka in the case of Mrs. Beena

Muralidhar Vs. Tax Recovery Officer and Anr. in W.P.

No.16100/2019 (T-IT) dated 18th July, 2019 had

allowed a writ petition. We have carefully considered the

submissions made by the learned counsel for the

appellant. The legal position as to the jurisdiction of this

Court under Article 226 of the Constitution of India is

well-settled and no longer res integra. It is no doubt true

that mere existence of an alternative remedy will not be an

absolute bar for entertaining a writ petition. Nevertheless,

no universal rule can be laid down as to under what

circumstances, the Court will exercise jurisdiction under

Article 226 of the Constitution of India or refuse to do so.

The learned counsel for the appellant in support of his

contention placed reliance on the celebrated decision of

the Hon'ble Supreme Court in Whirlpool Corporation -

Vs. Registrar of Trade Marks, Mumbai & Ors. reported

in (1998) 8 SCC 1. In fact, in a recent decision, the

Hon'ble Supreme Court has pointed out that alternative

remedy cannot operate as a bar in at least three

contingencies where the writ petition has been filed for

enforcement of any fundamental right or where there has

been violation of principles of natural justice or where the

order or proceedings are wholly without jurisdiction

and/or where vires of the Act is challenged. The

appellant seeks to bring his case within the ambit of the

exception which has been drawn by the Hon'ble Supreme

Court to show that the order of attachment is in violation

of principles of natural justice and this argument is

sought to be buttressed by referring to Section 226(3)(iii)

of the IT Act. Be it noted that Section 226 of the IT Act

deals with other modes of recovery. Sub-Section (1) of

Section 226 states that where no certificate has been

drawn up under Section 222, the assessing officer may

recover the tax by one mode or modes provided in Section

226. From the recovery certificate placed before us by

the learned counsel appearing for the appellant, we find

that the certificate has been issued under Section 28A of

the SEBI Act of 1992 read with Section 222 of the IT Act.

Therefore, the provisions of Section 226 of the IT Act

cannot be resorted to by the appellant as it deals with

cases where no certificate has been drawn under Section

222 of the IT Act. In any event, the certificate of recovery

and the consequential attachment and freezing of the

bank account and the term deposits is in exercise of the

powers conferred under the SEBI Act of 1992. The said

enactment is a special statute and it is a self-contained

code as that of the IT Act. Therefore, on the facts set out

by the appellant, we are not inclined to exercise our

jurisdiction under Article 226 of the Constitution of India

and we agree with the conclusion arrived at by the learned

Single Bench.

Insofar as the reliance placed by the learned

counsel for the appellant on the decision of the High

Court of Karnataka in Mrs. Beena Muralidhar (supra) is

concerned, we are of the view that the said decision may

not render assistance to the case of the appellant as that

was a case where no certificate was drawn up under

Section 222 of the IT Act. Therefore, the said decision is

distinguishable on facts.

For such reasons, the order impugned does

not call for interference and the appeal stands dismissed.

We restore the liberty granted to the appellant

by the learned Single Bench and we permit the appellant

to file appropriate application before the competent

authority with a prayer for lifting the order of attachment

and de-freezing the bank account and term deposit

account under the relevant statute and while entertaining

such an application, the concerned authority shall

endeavour to consider the application on merits by

excluding the period during which the writ petition was

pending before this Court and till receipt of the certified

copy of this judgment and order while computing

limitation.

Re: I.A. CAN 2 of 2018 (Old CAN 1908 of 2018)

In view of the dismissal of the appeal itself,

nothing survives in the stay application and therefore, the

stay application is also dismissed.

Urgent photostat certified copy of this order, if

applied for, be given to the parties expeditiously upon

compliance of all legal formalities.

( T. S. Sivagnanam, J.)

(Hiranmay Bhattacharyya, J.)