Debangsu Basak, J. - (1.) The petitioners assail two attachment notices issued by the Central Excise authorities.
(2.) The learned Senior Advocate for the petitioners submits that, the first petitioner had purchased the assets of a company incorporated under the provisions of the Companies Act, 1956 pursuant to a sale notice issued by a Bank acting under the provisions of Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002. He submits that, the business of such company was not put up for sale. Only the assets were put up for sale. The first petitioner had purchased such assets from the Bank. He refers to the sale notice issued by the Bank. He refers to the various clauses of the sale notice, which stipulate that the sale was on as is where is and whatever there is basis. He submits that, there is no whisper in the sale notice that the business of the company was being sold. The first petitioner purchased the assets only without the business of such company. The liability on account of Central Excise cannot be foisted upon the petitioners. He relies upon 2013 (295) E.L.T. 12 (S.C.) (Rana Girders Ltd. v. Union of India) in support of the contention that, there is a distinction between a purchase of assets and a purchase of the business. He submits that, the Hon'ble Supreme Court noticing such distinction did not fasten the liability on a purchaser of assets. He further submits that a review petition directed against Rana Girders Ltd. (supra) was rejected by the Hon'ble Supreme Court, reported in 2015 (320) E.L.T. A175 (S.C.) (Union of India v. Rana Girders Ltd.). He refers to 2016 (332) E.L.T. 601 (Guj.) (Shreejikrupa Spinners Pvt. Ltd. v. Union of India) and 2009 (234) E.L.T. 596 (Bom.) (Tata Metaliks Limited v. Union of India) and submits that, in terms of Section 11 of the Central Excise Act, 1944, recovery of sums from transferee of assets is permissible only when such transferee takes over the entire running business. In the present case, the first petitioner not having done so, the first petitioner is not liable. With regard to distinction between ownership of business and ownership of assets, he relies upon (2006) 1 SCC 615 (State of Karnataka and Anr. v. Shreyas Papers (P) Ltd. and Ors.). He submits that, in view of Section 11 of the Act of 1944 not empowering the Central Excise authorities to foist any liability of the defaulter to the purchaser of its assets, the order of attachment and all consequent orders of attachment made therein should be quashed.
(3.) The learned advocate appearing for the Department submits that the Bank was well aware of the dues of its borrower towards Central Excise. The Bank was informed from time to time by the authorities about such dues. The Bank ought not to have put up the property for sale without informing the Central Excise authorities. The first petitioner having purchased the property with the knowledge of default of the Central Excise, the first petitioner is liable to pay the same.;