Wahid Sandhar Sugars LTD. vs. State Of Punjab And Others

Facts

The appellant, Wahid Sandhar Sugars Ltd., filed an appeal against an order dated May 24, 2021, which directed the attachment of all its accounts, prohibiting withdrawals except for farmers' dues and workmen's salaries. The appellant contended that besides these, other mandatory monthly payments like provident fund, GST deposits, electricity bills, TDS, bank interest and installments, contractor and plant creditor payments, and administrative expenses, totaling approximately Rs. 5,35,00,000/-, also need to be made. Subsequently, an order dated June 7, 2021, from the Deputy Commissioner, Kapurthala, was produced, directing the SDM, Phagwara, to attach all bank accounts, with any further payments requiring sanction from the SDM. The appellant argued that the initial order did not account for these other essential payments.

Held

The Court held that the initial order dated May 24, 2021, which restricted withdrawals solely to farmers' dues and workmen's salaries, was not sufficiently comprehensive, given the appellant's stated need to make other mandatory monthly payments. The Court acknowledged that the sugar mill has other essential financial obligations. Consequently, the appeal was disposed of by modifying the order dated May 24, 2021. The appellant was permitted to make a representation to the SDM, Phagwara, detailing all the payments required on a monthly basis. The SDM, Phagwara, was directed to consider this representation and make a decision within a period of two weeks. This approach aimed to balance the revenue's interest in attachment with the appellant's operational necessities, including its statutory and contractual payment obligations.

Key Issues

1. Whether the order attaching all bank accounts of the appellant, restricting withdrawals only to farmers' dues and workmen's salaries, is legally sustainable given the appellant's other mandatory monthly financial obligations? (Mixed question of law and fact, concerning the scope and impact of attachment orders under relevant provisions of law). Contentions: Appellant: Argued that the attachment order was overly restrictive and failed to consider other essential monthly payments such as provident fund dues, GST deposits, electricity bills, TDS, bank interest and installments, contractor and plant creditor payments, and administrative expenses, which are crucial for the continued operation of the sugar mill. They highlighted the total monthly financial commitment beyond farmers' dues and salaries. Respondents (State of Punjab and others): The judgment records that the respondents, through the Assistant Advocate General, Punjab, presented an order dated June 7, 2021, from the Deputy Commissioner, Kapurthala, which directed the SDM, Phagwara, to attach all bank accounts but allowed for sanctioning of further payments by the SDM. No specific argument against the appellant's contention regarding other mandatory payments was recorded.