G V FILMS LIMITED Vs. S PRIYADARSHAN

JUDGEMENT

(1.) THESE appeals namely OSA No.311 of 2005 and WA 2239 of 2005, have arisen from the common judgment of the learned Single Judge of this Court made in C.S.No.454 of 2005 and W.P.No.17576 of 2005.

(2.) THE case of the appellant is as follows: (a) Since 1999, the appellant has been a lessee of the plaint scheduled mentioned premises which belonged to Sujatha Films Limited (SFL) and running two preview theatres. THEy have installed costly equipments in the premises for running the theatre. To recover the tax arrears from the said SFL, the Income Tax Department auctioned the schedule premises on 17.3.2005 pursuant to a proclamation of sale dated 7.2.2005. After the auction, the department attempted to transfer physical possession to the bidder even before the issuance of sale certificate. Immediately, the appellant filed a writ petition in WP 10094 of 2005, and an order was passed by this Court on 28.3.2005 restraining the department from interfering with the plaintiff's possession of the property for a minimum period of 30 days from the date of service of order dated 17.3.2005. THE said order was subsequently modified on 8.4.2005 to the effect that the department should not interfere with the plaintiff's possession for a minimum period of 30 days from the confirmation of the sale. THE confirmation of sale has been made by a certificate of sale dated 4.5.2005 issued by the department. While the matter stood thus, the defendants have made a hasty attempt to grab physical possession of the property. Under the circumstances, the appellant filed the above suit for a permanent injunction restraining the defendants from interfering with the plaintiff's possession and enjoyment of the property. (b) THE department has issued a letter dated 4.5.2005 demanding the appellant to vacate the subject premises by 3.6.2005 and has threatened to forcibly remove them from the property under Rule 39 of the Income Tax (Certificate of Proceedings) Rules, 1962. THE department has no power to issue the same. THE letter is vitiated by lack of jurisdiction. In the case of a property that is in the occupation of the tenant, once the certificate of sale is issued and Rule 40 is complied with as stated above, the obligation of the department has come to an end. Under such circumstances, the appellant has filed the above writ petition for a writ of certiorarified mandamus to quash the said letter.

(3.) ADVANCING arguments on behalf of the appellant, the learned Counsel Mr.Ravi would submit that the plaintiff/appellant has been a lessee of the premises described in the schedule to the plaint running two preview theatres that the premises belonged to the company called Sujatha Films Limited (SFL) that in order to substantiate the lease of the premises, the plaintiff has entered into three lease deeds and has also paid the interest free advance deposit of Rs.75 lakhs that the plaintiff has installed costly equipments in the said premises that in order to recover the arrears of income tax due of the lessor Sujatha Films Limited, the Income Tax Department made proclamation of sale on 7.2.2005 which was issued by the Tax Recovery Officer (T.R.O.) that as per the proclamation, the sale was fixed to be held on 17.3.2005 that the sale proclamation would clearly indicate that the property to be sold was clearly mentioned that it was also mentioned that the said theatre was under the occupation of the appellant as tenant that even prior to the date of the proclamation of sale, the appellant had corresponded with the respondent department on the subject and the department has addressed a letter to the appellant on 4.1.2005 that the department made a publication without mentioning that the property was under the occupation of the appellant as tenant that on 11.3.2005, the appellant objected to the proposed sale emphasising that their possession and right of occupancy through their letter and pointed out the defect in the proclamation and demanded rectification that a reply was sent by the department on 14.3.2005 that the lease in favour of the appellant for 9 years from 1990 was after a TRO notice dated 31.1.1990, and therefore the lease was invalid that the said notice was not mentioned in the proclamation of sale that despite the objections raised by the appellant and even without rectifying the defects, auction was held on 17.3.2005 and that the defendants in the suit were declared as successful bidders.