ORDER PASSED BY RESPONDENT NO.2 BEARING NO. ABK
/ OLD ARREARS / 34/1997-98 / 4405 DATED 07.02.2014
VIDE ANNEXURE - D AND ALL CONSEQUENT ORDERS PASSED THERE UPON BY RESPONDENT No.4 BY CREATING
CHARGE OVER THE PROPERTIES OF THE PETITIONER.
ISSUE A WRIT OF MANDAMUS AGAINST RESPONDENT
No.5 FOR INITIATING THE PROCEEDINGS AGAINST THE
CONTRACTORS AND OFFICIALS INVOLVED IN DUPING THE
PUBLIC MONEY TO THE GOVERNMENT OF KARNATAKA.
THIS WRIT PETITION IS COMING ON FOR ORDERS,
THIS DAY, THE COURT MADE THE FOLLOWING:
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ORDER
Heard Sri Avinash A. Uplaonkar, learned counsel for the petitioner and Sri Veeranagouda Malipatil, learned High Court Government Pleader for respondent Nos.1 to 4.
2. Writ petition is filed with the following prayer.
(i) To issue of writ of certiorari by quashing the order passed by respondent No.2 bearing NO. ABK / OLD ARREARS / 34/1997-98 / 4405 dated 07.02.2014 vide Annexure - D and all consequent orders passed there upon by respondent No.4 by creating charge over the properties of the petitioner, in the interest of justice and equity.
(ii) Issue a writ of Mandamus against respondent No.5 for initiating the proceedings against the contractors and officials involved in duping the public money to the Government of Karnataka.
(iii) Any other writ or order deemed fit in the facts and circumstances of the case in the interest of justice and equity."
3. Facts of the case are as under:
In respect of an unregistered partnership in the name and style of M/s.Aswini Enterprises, having its office at
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No.2-274/7, Jagath Gulbarga, respondent No.2 passed an order stating that in respect of the Excise Items namely; Sarayi demand of Rs.6,50,25,876/- and Rs.1,29,62,968/- are pending in Chittapur and Chincholli respectively. Accordingly, a charge was created on the property held by original writ petitioner - Veeranna S/ Zarnappa Guttedar. The same is called in question.
4. According to the writ petitioner, the rule would not permit an enquiry into an unregistered partnership firm. More over, no enquiry was held insofar as the liability of the petitioner is concerned before passing the order at Annxure - D and name of Veeranna is a common name and the petitioner was no way connected with the activities as is found in Annexure-D and therefore, he sought for holding an enquiry and till such time, no action would be taken including the creation of the charge on the property of the writ petitioner.
5. During pendency of the writ petition, writ petitioner died and his legal representative is brought on record.
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6. Per contra, learned High Court Government Pleader representing the respondents contended that when there is an unregistered partnership firm and they have treated the Excise Department in not paying the Excise Duty, there is every power available with the respondent No.2 to attach the properties of all concerned even in respect of unregistered partnership firm as the collection of Excise Duty is the dominant function that has to be exercised by the Excise Department and in such circumstances, the action of the second respondent is perfectly justified.
7. He also pointed out that if the petitioner is aggrieved by the order of the second respondent, there is an alternative remedy available in filing the appeal and instead of that, petitioner has approached this Court with writ petition and sought for dismissal of the writ petition.
8. Having heard the parties, this Court perused the material on record. On such perusal of the material on record, it is crystal clear that M/s. Ashwini Enterprises is a unregistered partnership firm. The partners shown therein
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is Venkatesh and Veeranna. So for as the second partner is concerned, the name of second partner and the writ petitioner tallies with each other.
9. Insofar as the enquiry that is contemplated for creating a charge on the property of a partner for non payment of Excise duty is concerned, is bound by the Excise Act. A person who has conducted the business in the name and style of M/s. Aswini Enterprises, solely on the ground that it is an unregistered partnership firm, cannot escape the excise duty and penalty.
10. However, a person if he has evaded the excise duty, the authorities cannot straight away take action against such person who said to have evaded the excise duty without holding a proper enquiry.
11. In the case on hand, the grounds urged in the writ petition would go to show that there is no enquiry held as against the original writ petitioner namely; Veeranna S/o Zarnappa Guttedar.
12. Annexure-D which is the order passed by the second respondent also does not make out a case that
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there was an enquiry held and thereafter the order at Annexure-D came to be passed. Same has resulted in miscarriage of justice in not following the principles of natural justice.
13. Therefore, it is just and necessary for this Court to direct the respondents to hold an enquiry and pass appropriate orders in accordance with law within a time framed.
14. The order that has been passed at Annexure-D in creating charge on the property of the petitioner shall be subject to such enquiry to be held in accordance with law. With that observation, writ petition stands disposed of.
Sd/-
JUDGE
MR,
CT:SI
List No.: 1 Sl No.: 6