T.T. P. TECHNOLOGIES PVT. LTD. REP. BY ITS MANAGING DIRECTOR Vs. THE REGIONAL PROVIDENT COMMISSIONER (C AND R) AND THE ASSISTANT PROVIDENT FUND COMMISSIONER RECOVERY OFFICER

JUDGEMENT

(1.) IN this writ petition the Petitioner has prayed for a writ in the nature of certiorari to quash the demand notice dated 28.10.2009 as per Annexure E issued by Respondent No. 2.

(2.) AN establishment called M/s. Aldea Electronics Private Limited (for short the establishment) was covered under the provisions of Employees Provident Fund and Miscellaneous Provisions Act, 1952 (for short 'the P.F. Act'). This establishment borrowed loan from the Karnataka State Financial Corporation (for short 'the Corporation') through its branch at Tumkur by pledging the movables and immovables. This establishment subsequently committed default in payment of the loan amount. Consequently the secured creditor - Corporation had taken over the assets of the establishment by exercising its power under Section 29 of the State Financial Corporation Act. Thereafter the secured creditor brought the machinery, land and building of the establishment for sale through public auction. One M/s Skanda/Venkataramana Gupta became the highest bidder and the Petitioner was the second highest bidder. Since the first highest bidder committed default in depositing 25% of the bid amount, his bid was cancelled. The secured creditor negotiated with the Petitioner herein being the second highest bidder and sold the property for a particular price. Clause 5 in the sale agreement between the Petitioner and secured creditor, is relevant for the purpose of this case and the same reads as under: 5. The statutory dues like commercial tax, central excise, provident fund claims, property tax, water tax, employees stale insurance arrears etc, shall be borne by you. However, we note to reserve your right to contest these liabilities without effecting the interest of the Corporation.

(3.) HEARD arguments on both the side and perused the entire writ papers.