NARSINGH DASS SHARMA Vs. DELHI ADMINISTRATION UNION TERRITORY OF DELHI

JUDGEMENT

(1.) This order will dispose of Civil Writ No. 951/70 and Civil Writ No. 710/70.

(2.) The Collector of Excise, Delhi Administration, respondent No. 2, in both the petitions conducted auction of the licence to vend country liquor at three country liquor shops styled as "Bhuli Bhatiari, Link Road, New Delhi", "Shahdara Delhi" and "Mehrauli". The highest bidder at the auction in the case of the first two shops was the firm Messrs. Nanak Singh and Company and the highest bid was Rs. 175900.00 and Rs. 146997.00 respectively. The highest bidder in respect of the third Mehrauli shop was the firm Bishamber Lal and Company with the highest bid of Rupees Rs. 114760.00. The bids of these auction- purchasers were accepted and the auctions were concluded in their favour. According to the allegations in the petition the partners of the firm Nanak Singh and Company, the approved licensees of Bhuli Bhatiari shop were different from the partners of the firm of the same name who were the approved licensees for the Shahdara Shop. Likewise the firm Bishamber Lal and Company the approved licensees of the Mehrauli shop, had also different partners. One Nanak Singh, however, was a common partner in all these firms. According to the case of the petitioner, Nanak Singh ran short of funds and approached the petitioner and his three friends Chuni Lal Grover, Som Parkash Sethi and Baldev Raj for financial assistance. They agreed to assist Nanak Singh but because Nanak Singh was not in a position to give any guarantee for repayment of the loan and interest the parties entered into a partnership in terms of the agreement dated November 7, 1969. It appears that the three licensees after the auction of the licenses in their favour did not deposit balance of the bid amount. Proceedings for the recovery of the amount so due from them were, therefore, taken by respondents 1 and 2. A certificate in the prescribed form was issued by the Collector under the Revenue Recovery Act (Act 1 of 1890) and was sent to respondent No. 3. the District Collection and Recovery Officer for initiating the necessary proceedings. Respondent No. 3 in turn moved the Clector of Meerut and the Collector of Gurgaon to recover the amount of Rs. 2,12,290.00 from the petitioners in the two petitions. In these circumstances both the petitioners have come up to this Court with petitions under Art. 226 of the Constitution praying that the recovery proceedings initiated against them being wholly illegal and not sustainable in law should be quashed and the respondents may be restrained from recovering any amount from them.

(3.) No affidavit in opposition has been filed by respondents 1 and 2. To bring out the point, on which both the writs, to my mind stand concluded, it is sufficient to reproduce the facts as contained in the affidavit filed by Shri F. S. Zulfiquar-ud-Din on behalf of respondent No. 3, (the District Collection and Recovery Officer) in opposition to C. W. 951/70. In this affidavit, it is not denied that the licences for the three country liquor shops were sold in favour of the partners constituting the three firms abovenamed of which the petitioners in both the writ petitions were not partners. But it was urged, (according to para 3 of the affidavit) that the petitioner in C. W. 951/70 along with Some Parkash Sethi (petitioner in C. W. 710/70), C. L. Grover and Baldev Raj had entered into a sub-partnership with Nanak Singh and in terms of this sub- partnership the partners were liable to pay their shares of losses and also to pay the licence-fee to the extent of their shares. It was further stated that recovery certificates issued by the Collector of Excise, respondent No. 2, had been received by this respondent for purposes of initiating the recovery proceedings against the licensees and that these certificates were directed against Messrs. Nanak Singh and Company and that the names of the defaulters were also mentioned in the certificate which included the name of Nanak Singh, but did not include the names of the petitioners. Respondent No. 3, in execution of these warrants, was able to realise some amount from the named defaulters but it was difficult to realise any further amount because particulars of the defaulters given in the certificate were not complete. Respondent No. 3, therefore, moved the Assessing Department and asked for the particulars. By letter dated 2nd June, 1970, the Assessing Department informed the respondent that the dues may be recovered "from all those connected with business of Nanak Singh and Company". Enquiries thereafter revealed the existence of the sub-partnership referred to above in which the petitioners, as stated earlier, were partners with Nanak Singh. Respondent No. 3 also received a copy of the balance-sheet of the account of the sub-partnership which was maintained by Nanak Singh. According to this balance-sheet maintained by Nanak Singh some amounts were shown due to him (Nanak Singh) from the petitioners. On the basis of this information, because the petitioners in these petitions were not residing in Delhi, respondent No. 3 sent recovery certificates to the Collector of the Districts where they were residing and these recovery proceedings came to be initiated against them.