VIJAYALAKSHMI ENTERPRISES Vs. ASSISTANT GENERAL MANAGER ANDHRA PRADESH FINANCIAL CORPORATION HYDERABAD

JUDGEMENT

(1.) In this writ petition, the petitioner herein which is a proprietary concern had sought for a declaration that a purchaser of goods in a sale under Section 29 of the State Financial Corporation Act, is not liable for the dues of the loanee payable to the Customs and Excise Authorities and for a direction upon the respondents 3 and 4 herein not to interfere with the removal of the machinery from the premises of the loanee and transport the same to the destination.

(2.) The establishment of M/s. Koratla Textiles Private Limited, Lingojigud village, Choutuppal Mandal, Nalgonda District was a loanee of the A.P. State Financial Corporation (hereinafter referred to as 'the loanee') machinery, furniture, fixtures and stores of the said company was put in public auction in terms of the provisions of Section 29 of the State Financial Corporations Act, 1951 (for short 'the Act'). The petitioner being the highest bidder, the said machinery etc., were transferred in its name. The loanee is a 100% Export Oriented Unit having availed of certain benefits of exemption from paying the customs duty for importing the machinery. It failed to discharge an obligation to pay customs duty to the tune of Rs.52-34 lakhs. The said failure to make payment, according to the customs authorities, would also attract penal action under Section 112 of the Customs Act for payment of penalty.

(3.) It is not in dispute that the said loanee executed a bond on 10-1-1994 for a period of five years which period had already expired (31-3-1998). It is also not in dispute that the customs authorities had been preventing the petitioner herein from transporting the said machinery on the ground that it has a charge there over.