M/S Rms Research Labs P Ltd., vs The Commissioner Of Customs And Excise
2023 Latest Caselaw 4410 Tel

Telangana High Court

M/S Rms Research Labs P Ltd., vs The Commissioner Of Customs And Excise on 27 December, 2023

Author: P.Sam Koshy

Bench: P.Sam Koshy, N.Tukaramji

IN THE HIGH COURT FOR THE STATE OF TELANGANA, HYDERABAD

                             ***

              WRIT PETITION No.21621 of 2004

 Between:


 M/s. RMS Research Labs (P) Ltd.
                                                      Petitioner
                           VERSUS

 The Commissioner of Customs and
 Excise and Ors.
                                                    Respondent


            ORDER PRONOUNCED ON: 27.12.2023

            THE HON'BLE SRI JUSTICE P.SAM KOSHY

                             AND

            THE HON'BLE SRI JUSTICE N.TUKARAMJI



 1.   Whether Reporters of Local newspapers

      may be allowed to see the Judgments?            : Yes

 2.   Whether the copies of judgment may be

      Marked to Law Reporters/Journals?               : Yes

 3.   Whether His Lordship wishes to

      see the fair copy of the Judgment?              : Yes



                                             ___________________
                                             P.SAM KOSHY, J
                                    2




              * THE HON'BLE SRI JUSTICE P.SAM KOSHY
                                  AND
               THE HON'BLE SRI JUSTICE N.TUKARAMJI



                    + WRIT PETITION No.21621 of 2004



% 27.12.2023

#     Between:

M/s. RMS Research Labs (P) Ltd.
                                                          Petitioner
                                VERSUS

The Commissioner of Customs and
Excise and Ors.
.
                                                        Respondent


! Counsel for Petitioner(s)              : Mr. G. Mohan Rao



^Counsel for the respondent(s)           :Mr. A. Ramakrishna Reddy
                                          for respondent Nos.1 to 3



<GIST:

> HEAD NOTE:



? Cases referred
1
    (2013) 10 SCC 746
                                  3




     THE HONOURABLE SRI JUSTICE P.SAM KOSHY
                     AND
     THE HONOURABLE SRI JUSTICE N.TUKARAMJI

             WRIT PETITION No.21621 OF 2004

ORDER:

(per Hon'ble Sri Justice P.SAM KOSHY)

The instant Writ Petition has been filed assailing the

notice of demand to defaulter dated 16.11.2004 issued by

respondent No.3.

2. The demand amount was Rs.22,02,216/- towards

excise duty. In addition to that, there was a demand of

Rs.13,30,000/- towards penalty and interest.

3. The petitioner had challenged the said notice of

demand on the ground that it is an auction purchaser of

subject property which stood mortgaged with respondent

No.4. Originally, the subject property was mortgaged by its

owner in favour of respondent No.4, and when the

mortgagee defaulted in repayment of loan amount,

respondent No.4 put the property to auction. The

petitioner had purchased the subject property in the

auction and occupied the same. Subsequent to petitioner's

purchase and occupation over the subject property, the

impugned notice of demand has been issued to the

petitioner.

4. The law in this regard is well settled, as would be

evident from the decision of the Hon'ble Supreme Court in

the case of Rana Girders Ltd. Vs. Union of India 1,

wherein it has been specifically held that subsequent

transferee or the auction purchaser of the secured property

would not be liable for the payment of outstanding amount

which was due upon the defaulter.

5. The said decision of the Hon'ble Supreme Court has

also been followed by a Division Bench of this Court in

bunch of Writ Petitions i.e., W.P.Nos.3428 of 2007 and

batch, decided on 15.11.2022.

6. In view of the same, we are inclined to allow the

present Writ Petition. Therefore, the Writ Petition stands

allowed setting aside the notice of demand dated

16.11.2004 issued by respondent No.3 to the extent of

raising the demand against the petitioner. However, it

would be open to respondent No.3 to take such steps as

(2013) 10 SCC 746

may be permissible in law for recovery of outstanding

excise duty from the original defaulter. No order as to

costs. Consequently, miscellaneous petitions pending, if

any, shall stand closed.

____________________ P.SAM KOSHY, J

____________________ N. TUKARAMJI, J Date: 27.12.2023 TJMR