Rajasthan High Court
M/S. Sanwaria Sweets Private Limited vs Union Of India on 20 December, 2023
Bench: Manindra Mohan Shrivastava, Praveer Bhatnagar
[2023:RJ-JP:38696-DB]
HIGH COURT OF JUDICATURE FOR RAJASTHAN
BENCH AT JAIPUR
D.B. Review Petition (Writ) No.113/2019
In
D.B. Civil Writ Petition No.2031/2018
Natwar Lal Sharda S/o Late Sh. Tansukh Rai Sharda, Aged About
55 Years, Resident Of M-38-39, Mahesh Colony, Tonk Phatak,
Jaipur, (Rajasthan)
----Petitioner
Versus
1. Union Of India, Through Its Secretary, Department Of
Revenue, Ministry Of Finance, North Block New Delhi
2. Directorate General Of Goods And Services Tax
Intelligence (DGGSTI), Through Its Director General,
West Block-VIII Wing- VI, 1st Floor, Sector - 1 R.K. Puram,
New Delhi- 110066
3. Sh. Rajesh Verma, Senior Intelligence Officer, Director
General Of Goods And Services Tax Intelligence
(DGGSTI), West Block-VIII, Wing- VI, 1 Floor, Sector - 1 st
R.K. Puram, New Delhi- 110066
4. M/s Sanwaria Sweets Private Limited, Through Its
Director-Mr. Ajay Sharda Registered Office At J-6, Himmat
Nagar, Tonk Phthak, Jaipur (Rajasthan).
----Respondents
Connected With
D.B. Review Petition (Writ) No.89/2019
In
D.B. Civil Writ Petition No.2031/2018
M/s. Sanwaria Sweets Private Limited, Through Its Director- Mr.
Ajay Sharda, Registered Officer At J-6, Himmat Nagar, Tonk
Phatak, Jaipur (Rajasthan).
----Petitioner
Versus
1. Union Of India, Through Its Secretary Department Of
Revenue, Ministry Of Finance, North Block New Delhi.
2. Directorate General Of Goods And Services Tax
Intelligence (DGGSTI), Through Its Director General West
[2023:RJ-JP:38696-DB] (2 of 10) [WRW-113/2019]
Block-VIII, Wing-VI, 1St Floor, Sector- 1 R.K. Puram, New
Delhi- 110066.
3. Sh. Rajesh Verma, Senior Intelligence Officer Director
General Of Goods And Services Tax Intelligence
(DGGSTI), West Block-VIII, Wing-VI, 1St Floor, Sector-1
R.K. Puram, New Delhi- 110066
----Respondents
For Petitioner(s) : Mr. J.K. Mittal, Advocate with
Mr. Anupam Bhargava, Advocate
For Respondent(s) : Mr. Satish Aggarwala, Advocate
Mr. Kinshuk Jain, Advocate with
Mr. Jay Upadhyay, Advocate
Mr. Saurabh Jain, Advocate
Mr. Daksh Pareek, Advocate
HON'BLE THE ACTING CHIEF JUSTICE MR. MANINDRA MOHAN SHRIVASTAVA
HON'BLE MR. JUSTICE PRAVEER BHATNAGAR
Judgment
20/12/2023
1. By these review petitions, the petitioners have prayed for
review of order dated 12.02.2019 passed in D.B. Civil Writ Petition
No.2031/2018 (M/s. Sanwaria Sweets Private Limited Versus
Union of India & Others) and prayed for recalling/modifying of the
aforesaid order.
2. The factual matrix giving rise to these review petitions are
that M/s. Sanwaria Sweets Pvt. Ltd. filed writ petition
(No.2031/2018) challenging action of respondent Nos.2 & 3
against the petitioner-company. The petitioner therein challenged
the search conducted on 27.08.2017 in the premises of the
petitioner-company and also prayed for return of all the
documents including original sale-deed of various immovable
properties taken away during search. A prayer was made for
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issuance of direction to respondent No.1 to take action against the
officer of respondent No.2 and also against respondent No.3 in
terms of Service Rules, for indulging in vexatious search in the
premises of the petitioner-company. Prayer was also made to
restrain the respondents from disposing of or tinkering with the
documents taken away from the petitioner-company during search
conducted on 27.08.2017. That writ petition was finally decided
vide order dated 12.02.2019 and it was dismissed. While
dismissing the said petition, the Division Bench of this Court
considered the submissions and examined the material on record
and came to the conclusion that the material collected by the
respondents suggested that the officials of the respondents in
conducing search acted bona fide.
3. The review petition (No.113/2019) came to be filed by the
petitioner Mr. Natwar Lal Sharda ventilating grievance that various
remarks, observations, conclusions, findings have been recorded
regarding nexus of the petitioner in the alleged evasion of tax
though on the date when the search was conducted, the petitioner
was no longer Director in the company namely M/s. Sanwaria
Sweets Private Limited (petitioner in D.B. Civil Writ Petition
No.2031/2018). According to the review petitioner, he has no
connection whatsoever with the affairs of the M/s. Sanwaria
Sweets Private Limited and he had no role to play nor in any
manner involved in any tax evasion allegedly committed by M/s.
Sanwaria Sweets Pvt. Ltd. According to the review petitioner,
though on such allegations of he being involved in evasion of tax,
he was arrested but later on, granted bail. An application for
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cancellation of bail was also rejected. He had filed two writ
petitions before the Delhi High Court; Writ Petition (C)
No.9956/2017 was filed seeking declaration that the action of the
officers of respondents therein against the review petitioner was
arbitrary, malicious and motivated and search conducted in his
residential premises were illegal and against the provisions of law
along with the prayer seeking declaration that detention was
illegal. Prayer was also made for direction to conduct inquiry
against the officers of the respondents therein.
In another case i.e. Criminal Writ Petition No.3532/2017,
validity of provisions of Sections 13, 14, 19, 20 and 21 of the
Central Excise Act, 1944 has been questioned on the ground that
the same is ultra-vires various provisions of the Criminal
Procedure Code, 1973 and the Constitution of India. Prayer has
also been made for quashing criminal proceedings initiated against
the review petitioner.
4. When the petitioner came to know that in the petition filed
by M/s. Sanwaria Sweets Private Limited (Writ Petition
No.2031/2018 and connected review petitions), order has been
passed by Division Bench of this Court on 12.02.2019 wherein
various findings have been recorded against the present review
petitioner in D.B. Review Petition (Writ) No.113/2019 regarding
his involvement in the alleged evasion of tax whereas he was not
one of the Director on the date of search, the Writ Petition (C)
No.9956/2017 filed before the Delhi High Court has been
withdrawn and present review petition has been filed.
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5. Learned counsel appearing for the petitioner-Natwar Lal
Sharda argued in extenso and submitted that though various
findings have been recorded against the review petitioner, the
review petitioner was not party in the said petition because he was
no longer Director of the company, therefore without hearing him,
no observation or remark could be made against him. According to
him, the review petitioner had resigned from the directorship of
the company and filed application on 11.09.2017 in Form 32/DIR-
12 with the Registrar of Companies. Further submission is that the
observation made in the order that review petitioner was the
Managing Director of the company is not correct. On the date
when the search was carried out on 27.08.2017, he was not
present because he was taken away by the officers of the
respondents and no inquiry has been made from the review
petitioner with regard to the search carried out on 27.08.2017. His
residential premises were searched on 26.08.2017 at Jaipur and
he was taken away to Delhi. He was later on arrested on
27.08.2017 on the allegation of evasion of excise duty of Rs.63
crores by unregistered factory at Bastar with which the review
petitioner is not at all connected. His bail application was allowed
on 27.09.2017 by the Ld. CMM Patiala House Court, Delhi as
prima facie he was not found involved. Therefore, in the present
case, the observations which have been made against the review
petitioner are liable to be expunged as those observations would
otherwise harm the review petitioner in other proceedings
including criminal proceedings against him.
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6. On the other hand, learned counsel appearing for the
respondents would submit that no case for review is made out. He
would submit that the writ petition filed by M/s. Sanwaria Sweets
Private Limited sought various directions for taking action against
the officers of the respondents on the allegation that the search
and further proceedings were vexatious and an act of harassment.
The material placed before the writ court by the respondents was
thoroughly and meticulously examined and on the basis of the
material before the Court, observations were made regarding
review petitioner's role also. He would further submit that the
issue with regard to review petitioner continuing as Director of the
company on the date the search was carried out itself is a serious
issue. The order passed in the Writ Petition No.2031/2018 does
not conclude all the proceedings pending in various fora but only
answers issues arising in the case that without any basis search
was conducted and the Director of the petitioner-company and
their family members were harassed. He would further submit that
Division Bench has passed a detailed order and with reference to
the specific material on record, it has been stated that some
incriminating material has emerged from the record indicating
involvement of the present petitioner. Therefore, the review
petition is without any basis and deserves to be dismissed.
7. A perusal of the order dated 12.02.2019 passed by this
Court in D.B. Civil Writ Petition No.2031/2018 and connected
review petitions reveals that petition was filed by M/s. Sanwaria
Sweets Private Limited through its Director Mr. Ajay Sharda inter
alia with the prayer that action of the respondents therein namely
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Director General of Goods and Services Tax Intelligence in
conducting search in the premises of the petitioner at Jaipur on
27.08.2017 be declared arbitrary, malicious, motivated, illegal and
contrary to the provisions of the Central Excise Act, 1944 and also
without jurisdiction. Prayer was also made for return of all the
documents including original sale-deed/title deed of various
immovable properties allegedly taken away on 27.08.2017 during
the search proceedings. Prayer was also made for taking action
against the officers of the respondents therein on the allegation
that search was vexatious. There were two review petitions also
filed by the Department seeking review of an order dated
09.08.2018 passed by the Division Bench wherein direction was
issued to take appropriate action in view of prayer alleging
vexatious search.
8. The Court took into consideration various submissions made
by learned counsel for the parties, material on record including
certain incriminating material which were collected by the officers
of the Department and noticed. At the first place, it needs to be
noticed that material placed on record were examined for the
limited purposes whether the search conducted was vexatious.
The material on record shows that number of proceedings are
pending at various fora and subsequently show cause notice has
also been issued to the review petitioner--Natwar Lal Sharda.
There are allegations of his involvement in evasion of tax. Prima
facie consideration of material on record was undertaken only to
find out whether it is a case where search carried out and other
proceedings could be said to be completely malicious, vexatious
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and without any material. It was observed that the Director of
M/s. Sanwaria Sweets Private Limited Mr. Ajay Sharda is none
other than the son of the present review petitioner. The assertion
of the respondents that the review petitioner also happens to be
the Director of the petitioner-company was taken into
consideration. It was also taken into consideration that two writ
petitions have already been filed and that search was conducted in
the premises of the review petitioner. The fact that the review
petitioner was arrested and then granted bail has also been taken
into consideration. It has also been taken into consideration that
vide order dated 18.12.2017, the Delhi High Court has declined to
grant any interim relief observing that review petitioner is accused
of a serious offence of evading excise duty of more than Rs.63
crores and the matter is at the stage of investigation. The order
under review and the statements made in the counter affidavit
regarding involvement of the present review petitioner were also
taken into consideration. It has also been taken into consideration
that on the basis of intelligence inputs, search was carried out at
various premises at Bastar, Indore and Jaipur including residential
premises of the review petitioner. Recovery of certain materials
during the course of search carried out in different premises, have
also been taken into consideration. The material, prima facie,
disclosing involvement of the present review petitioner has also
been taken note of. All the materials which have been collected by
the respondents during the course of search and other
proceedings were noticed by the Court and only thereafter certain
observations have been made. It is not a case where this Court
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has written any finding of guilt against the present review
petitioner--Natwar Lal Sharda. However, existence of material on
record prima facie indicating involvement of the present review
petitioner along with other Directors of the company and other
persons have been considered while examining the allegations
that the search carried out in the business premises of the
company and its Director and family members was vexatious,
malicious and without any material whatsoever. What weight is
required to be given to those materials would be a matter to be
considered in various proceedings drawn by the Department and
in other criminal proceedings. This Court only examined the
material on record to find out whether the search carried out in
the premises of the company could be said to be vexatious. On
consideration of various material placed before the Court, the writ
petition has been dismissed.
9. Therefore, no case for review is made out in D.B. Civil
Review Petition No.113/2019.
10. In the other review petition filed by M/s. Sanwaria Sweets
Private Limited namely D.B. Review Petition (Writ) No.89/2019,
the review petitioner only seeks to re-iterate all those submissions
which were made before this Court and were examined in detail.
The material on record was meticulously examined and on the
basis of material on record, the order has been passed. The
review petition filed by M/s. Sanwaria Sweets Private Limited fails
to satisfy that there is any error apparent on the face of the
record. If we may say so, the review petition filed by M/s.
Sanwaria Sweets Private Limited is an appeal in disguise.
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11. In the result, both the review petitions are sans substratum
and, therefore, dismissed.
12. A copy of this order be placed in each of the connected
petition.
(PRAVEER BHATNAGAR),J (MANINDRA MOHAN SHRIVASTAVA),ACTING CJ
Karan/
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