TMI Blog2021 (6) TMI 6X X X X Extracts X X X X X X X X Extracts X X X X ..... en has not been discharged. In fact, the attempt to establish compliance is also lukewarm. R1 the Adjudicating Authority, has chosen not to file a counter and the only counter filed is by the Deputy Commissioner of Income Tax, Chennai, on his and on behalf of R1. Being a matter involving the internal records of R1, particularly one that has serious repercussions and ramifications on the veracity of the orders passed, it would have been appropriate for R1 to explain the exact position. The object and purpose of the enactment as well as the rigour it imposes, and the serious civil consequences that it carries require that the procedure and times lines set out there, are followed scrupulously. There must be no shadow cast upon the processes followed in decision making and rendition, that must be unimpeachable and cast-iron. In the paragraphs leading to this conclusion, I have set out the narrative in regard to the decision making process as well as the gaps, lapses as well as mismatch in the dates of the intervening events, prior to dispatch of the orders. We are of the view that the prohibition imposed by the provisions of Section 26(7) will apply squarely in this case and the imp ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ause notice dated 26.04.2018 under Section 24(1) of the Act from R2 (Deputy Commissioner of Income Tax, Benami Prohibition), the Initiating Officer/IO, alleging that the petitioner is a benamidhar for Marg, its parent company, which beneficially owns the property comprising 17.702 acres of land in Muttam Village, Nagore Vattam ( asset ). 4. The show cause notice alleged that during 2009 and 2010, a loan had been availed by the petitioner from an entity by the name and style of Great Meera Finlease Private Limited, a Non-banking finance company (NBFC) incorporated solely for the purpose of routing of the funds of the Marg group, and for the purchase of the asset. The funds were drawn from the account of Arohi Infrastructure Private Limited, a subsidiary of Marg. 5. The allegation that it is a benamidhar of the asset and Marg the beneficial owner, was denied by the petitioner. An explanation was set forth stating that Marg is involved in the business of development of real estate and infrastructure projects. In 1961, the Urban Land (Ceiling and Regulation) Act, 1976 (in short Ceiling Act ) came into effect limiting the maximum acreage of land that may be held by a company ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rsued by the petitioner. 11. My attention is drawn to the Scheme of the Act and the procedure for attachment and adjudication. An order of adjudication is to be passed in terms of Section 26(7) within one year from the end of the month in which a reference under sub-section (5) of Section 24 was received by the Adjudicating Authority. 12. In the present case, the reference in terms of Section 24(5) was made on 27.07.2018, the same having been taken on file by R1 on 01.08.2018. Thus an order of adjudication ought to have been passed, in line with Section 26(7), on or before 31.08.2019. The petitioners would allege however that though the matter was heard finally on 17.07.2019, no orders were passed prior to 31.08.2019. They were informed, on 29.10.2019, to collect the order passed by R2, wherein the date mentioned was 26.08.2019. 13. At paragraph 12 of the affidavit filed in support of the Writ Petition, it is stated that the petitioner verified the reason for the delay in communication of the order finding that the order had been dispatched only on 13.09.2019 after notarization on 09.09.2019. The petitioner questions the elapse of time between 17.07.2019 when the mat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ted 17.07.2019 to the effect that order is passed accordingly and the date noted in hand, as 26.08.2019. According to respondent counsel, a combined reading of order sheet dated 17.07.2019 and the order dated 26.08.2019 will show that the process of hearing that commenced on 10.10.2018 had concluded on 17.07.2019, culminating in order passed on 26.08.2019. Pages 5 to 8 are orders in identical sequence in the case of an appeal bearing reference No.R-1038 of 2018 where the order was passed on 28.08.2019. No records setting out the sequence for orders dated 27.08.2019 have been filed. 19. Pages 9 to 16 are extracts of a register said to be maintained by the members of the Adjudicating Authority. The register contains 10 columns, (1) - serial number, (2) date of receipt of reference, (3) - particulars of reference, (4) - date of provisional attachment order under Section 24(4), (5) - date of letter for reference, (6) - date by which notice under Section 26(1) is to be issued, (7) date on which notice under Section 26(1) was issued, (8) date of expiry of limitation under Section 26(7), (9) - date of order under Section 26(7) and (10) remarks. 20. Pages 17 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the order was made available only on 09.09.2019. The claim of the petitioner is misleading. Originally, the orders which were sent by the Adjudicating Authority sent all those orders to this office vide letters dt. 14.10.2019 and 21.10.2019 with the following remarks: Pl. find enclosed herewith the copy of decision in respect of Ref No: R- 975/2018 to R-1043/48,976 to 986, 988 to 991 995 to 1043/18 of defendants, as the same has been referred by the postal authorities with the reasons mentioned on the envelope with reg. to send the same to the concerned defendant Subsequently, the petitioner was contended and they took delivery of the orders only on 29.10.2019. Since the order has been passed by the ld. Adjudicating Authority on 26.08.2019 itself, the averment of the Petitioner that on perusal of records, it would be clear that 1st Respondent, with an intention to circumvent the timeline has conveniently passed an order on the later date and has camouflaged as if the order has been passed on the 26.08.2019 is not correct.' The dispatch of the orders was on 12.09.2019 and 13.09.2019, as evidenced by the certificates of Speed Post. 23. On the undisp ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the property held benami may alienate the property during the period specified in the notice, he may, with the previous approval of the Approving Authority, by order in writing, attach provisionally the property in the manner as may be prescribed, for a period not exceeding ninety days from the date of issue of notice under sub-section (1). ...... (5) Where the Initiating Officer passes an order continuing the provisional attachment of the property under sub-clause (i) of clause (a) of sub-section (4) or passes an order provisionally attaching the property under subclause (i) of clause (b) of that sub-section, he shall, within fifteen days from the date of the attachment, draw up a statement of the case and refer it to the Adjudicating Authority. 26. Adjudication of benami property.- (1) On receipt of a reference under sub-section (5) of section 24, the Adjudicating Authority shall issue notice, to furnish such documents, particulars or evidence as is considered necessary on a date to be specified therein, on the following persons, namely:- (a) the person specified as a benamidar therein; (b) any person referred to as the beneficial owner ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f the property in question, pending investigation. Section 25 deals with the manner of service of notices and Section 26, with the process of adjudication of the transaction by the adjudicating authority. 29. Section 27 is the culmination of proceedings and provides for, in cases where the order of adjudication is adverse to the person concerned, confiscation and vesting of the property in the concerned authority. The provisions of Section 27(3) state that the confiscation is absolute, and free from all encumbrances and shall be gratis, insofar as no compensation shall be payable in respect of properties acquired by the authority. The rigour of the enactment is apparent and interpretations of the provisions, must be in line with its avowed object and intendment. 30. I now refer to and discuss the cases cited by the petitioner. No cases have been relied upon by the respondent on the aspect of bar of limitation. 31. In the case of Raja Harish Chandra Raj Singh v. Deputy Land Acquisition Officer and Another AIR 1961 SC 1500 the question that arose before the Supreme Court was a determination of the scope and effect of the proviso to Section 18 of the Land Acquisitio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f 1928 dated 26.11.1929) (Part 12 Law Weekly, 1930 Vol. XXXI page 487 , the question that came before the Appeal Court was the employment of the expression making of the order , employed in Sections 73 and 77 of the Indian Registration Act, and the Court held as follows: .. The learned Advocate-General for the defence contends that we must have regard to the express wording of the Act and that the words making of the order are too distinct to admit of any liberal construction. The answer is, no two constructions are possible, the meaning I have suggested being the only reasonable construction of the words. The very word order by necessary implication means in law, that the party affected has had reasonable notice of it. Not a single case in India has been brought to our notice which takes a different view. On the contrary, every decision on the point seems to recognise the principle I have stated. That any particular ruling proceeds on the special provisions of any Act makes, in my opinion, no difference. Abdul Ali v. Mirja Khan (1) is a case under Sect. 77 of the Indian Registration Act and is directly in point. The same rule has been laid down without equivoc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... unexplained silence between 17.07.2019 when orders were reserved, and 09.09.2019 when the order was certified by the Registrar, compels the respondent to establish unambiguously when exactly the impugned orders were passed. This could have been established either by the authority listing the matter and having pronounced its decision in open court, which was not done, or by contemporaneous evidences like records to establish the sequence of the processes for passing of the order and transmission to the registry for copying, certifying and dispatch. 40. The pale and unsatisfactory explanation set out in the counter and the registers maintained by the authority and registry as noted in detail in the above paragraphs, do not, in my considered view, give any support to the position that the impugned orders were passed on the dates mentioned therein. 41. I now move on to the second limb of the argument, that the order passed, to be within limitation, must be proved to have moved out of the control of the authority concerned, before the date of expiry of limitation. In the case of Government Wood Works V. State of Kerala 1988 (69) STC 62 (Ker.) a Division Bench of the Kerala ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 14. The order of any authority cannot be said to be passed unless it is in some way pronounced or published or the party affected has the means of knowing it. It is not enough if the order is made, signed, and kept in the file, because such order may be liable to change at the hands of the authority who may modify it or even destroy it, before it is made known, based on subsequent information, thinking or change of opinion. To make the order complete and effective, it should be issued, so as to be beyond the control of the authority concerned, for any possible change or modification therein. This should be done within the prescribed period, though the actual service of the order may be beyond that period. This aspect of the matter had not come up for consideration in the cases of Viswanathan Chettiar [1954] 25 ITR 79 (Mad.) and Laxmidas Co. [1969] 72 ITR 88 (Bom) where the only question dealt with was whether service of the order after the prescribed period rendered it invalid. Unless, therefore, the order of the Deputy Commissioner in this case had been so issued from his office within the period prescribed, it has to be held that the proceedings are barred by limitatio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... settled propositions to the sequence of events in the present matters. After a series of hearings in the matter, I find that the Adjudicating Authorities have reserved the matter on 17.07.2019, which was the 9th day of the hearing. Thereafter, the matter has not been listed for pronouncement. The impugned orders dated 26.08.2019, 27.08.2019 and 28.08.2019 were not pronounced in open Court. 49. At paragraph 9 of the impugned order, the respondent states that an appeal against the order lies before the Appellate Tribunal under Section 46(1) of the Act within a period of 45 days from date of receipt of the order . This is contrary to the provisions of Section 46, which provides for a period of 45 days for filing an appeal in the prescribed format along with the prescribed fee to the Appellate Tribunal within a period of 45 days from date of the order . Any appeal in terms of Section 46 would thus have to be filed on or before 10.10.2019 (qua order dated 26.08.2019) and not 45 days from the date of receipt of the order. 50. As regards the passing of the orders on 26.08.2019, 27.08.2019 and 28.08.2019, there is a handwritten sentence in order dated 17.07.2019 to the ef ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... not been discharged. In fact, the attempt to establish compliance is also lukewarm. R1 the Adjudicating Authority, has chosen not to file a counter and the only counter filed is by the Deputy Commissioner of Income Tax, Chennai, on his and on behalf of R1. Being a matter involving the internal records of R1, particularly one that has serious repercussions and ramifications on the veracity of the orders passed, it would have been appropriate for R1 to explain the exact position. 55. In Arjun Singh v. Mohindra Kumar AIR 1964 SC 993 the Supreme Court was considering the condonation of delay by the Courts in cases where a challenge to a proceeding was put forth after the expiry of the statutory period of limitation, and what would constitute sufficient cause for the Courts to consider the condonation of delay in approaching the court. Though we are not concerned with this question in the present case, the principles touching upon the law of limitation were elaborated upon in the course of the discussion, thus: 11. The expression sufficient cause should be given a liberal interpretation to ensure that substantial justice is done, but only so long as negligence, in ..... X X X X Extracts X X X X X X X X Extracts X X X X
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