Full Judgment Text
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CASE NO.:
Appeal (civil) 3024 of 2006
PETITIONER:
UNION OF INDIA AND ORS.
RESPONDENT:
M/S. A.M. OVERSEAS AND ANR.
DATE OF JUDGMENT: 18/07/2006
BENCH:
Dr. AR. LAKSHMANAN & LOKESHWAR SINGH PANTA
JUDGMENT:
J U D G M E N T
(arising out of SLP(C) No.23168/2005)
Dr. AR . Lakshmanan, J.
Leave granted.
Heard Mr. Mohan Parasaran, learned Additional Solicitor General for
the appellant-Union of India and Mr. Arun Jaitely, learned Senior Counsel for
respondent No.1.
The appeal was filed by the Union of India through its Secretary,
Ministry of Finance and the Director of Revenue Intelligence and two others
questioning the correctness of the judgment passed by the High Court dated
14.10.2005. The High Court while allowing the writ petition filed by
respondent no.1 held that the action of the appellants herein in preventing
respondent no.1 from operating its account was bad in law and the appellants
could not have issued any direction under section 110(3) read with section
113(i) and section 121 of the Customs Act, 1962. Consequently, the High
Court has directed the second respondent Bank to release the account of
respondent no.1 and permit operation thereof.
In this appeal, several grounds have been raised by the Union of India
questioning the legality and correctness of the orders passed by the High
Court. In view of the subsequent developments, we are not going into the
questions of law raised and the merits in this appeal at this stage.
It is stated by the learned Senior Counsel for respondent no.1 that the
first respondent’s Bank Account was freezed by the appellants herein on
30.7.2005. The High Court passed the judgment in favour of respondent No.1
on 14.10.2005. A sum of Rs.49,86,755.25 was seized by the appellants
herein, which was in credit in the Bank Account of the first respondent with
the second respondent. It appears that the first respondent, between
15.10.2005 and 29.10.2005, has withdrawn a sum of Rs.49,09,712/- leaving a
balance of Rs.75,043.25. The appellant filed the special leave petition before
this Court only on 28.10.2005. This Court on 11.11.2005 granted interim
stay till the matter is listed on due date.
It is, thus, seen that the first respondent has withdrawn the amount in
the Bank Account before the order of stay was passed by this Court. In view of
the withdrawal, the appeal filed by the appellants has become infructuous.
However, we leave the question of law raised in this appeal open to be decided
in an appropriate case. It is also submitted by the learned Additional Solicitor
General that in view of the withdrawal of the entire amount from the Bank
Account, a fresh show cause notice was issued after the investigation was
completed. It is for the appellant to proceed further in accordance with law.
In view of the order now passed, there cannot be any order of seizure of
the Bank Account by the appellants. We, therefore, lift the orders of seizure
made on 30.7.2005 and 5.8.2005 and the respondent No.1 is at liberty to
operate the said Bank Account and the second respondent will permit the first
respondent to operate the said Bank Account in view of the order now passed.
The Appeal is accordingly allowed. There shall be no orders as to costs.