NON  REPORTABLE

IN THE SUPREME COURT OF INDIA CIVIL APPELLATE JURISDICTION

CIVIL APPEAL NO.2672 OF 2009

Standard Chartered Bank             …

Appellant

VERSUS

Asstt.Commr. of Income Tax,  Bombay & Ors.                      … Respondents

(With  I.A.Nos.12-14  &  15-17  in  C.A.Nos.7269- 7271/08,  I.A.Nos.13-16  in  C.A.Nos.326-329/08  &  I.A.Nos.16-20 in C.A.Nos.7272-7276/08.  

O R D E R TARUN CHATTERJEE,J.  1. Standard Chartered Bank (hereinafter called as the  

‘Bank’) has filed C.A. No. 2672 of 2009 against an  

interim order dated 3rd of April, 2009 of the Special  

Court at Mumbai constituted under the provisions  

of the (Trial  of Offences relating to Transaction in  

Securities) Act, 1992 (in short, “the Act”) in so far as  

the  Special  Court,  instead  of  embarking  on  

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distribution of the moneys of the appellant which  

had  been  diverted  to  the  accounts  of  the  broker  

Harshad Shantilal  Mehta  (HSM),  has  held  that  it  

will not be fair to decide the matter  of  distribution  

without waiting for the decision of the CIT (Appeals)  

of  the  liability  of  HSM  to  Income-tax  for  the  

statutory period from 1.4.1991 to 6.6.1992. Several  

Interlocutory  Applications  (shown  hereinbefore)  

have  been  filed  in  the  appeals,  which  had  been  

disposed of by this Court on 3rd of December, 2008.  

2.       We have heard the learned counsel  for  the  

parties  and  considered  the  Interlocutory  

Applications filed in those disposed of appeals and  

the order passed by us in the earlier litigation. In  

our view, the Special Court, Mumbai was justified  

in not permitting  the  appellant-Bank to get  the  

amount  lying  with  the  custodian  before  the  final  

adjudication  now  pending  before  the  CIT  (A),  

Central  V,  Mumbai  is  made.   It  is  an  admitted  

position that CIT (Appeals) Central V, Mumbai has  

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already heard out the Income Tax Appeal excepting  

that an application has been filed before it by the  

heirs  and  legal  representatives  of  the  HSM  for  

setting  aside  the  decree  passed  in  favour  of  the  

Bank.

3.    Ms.Kamini Jaiswal, learned counsel appearing on  

behalf of the heirs and legal representatives before  

us submitted on instruction that  they  will file their  

documents and argue the case on their behalf and  

conclude their arguments within four months from  

this  date  positively  without  asking  for   any  

adjournment on any ground whatsoever.  

4. Such being the stand taken by the heirs and legal  

representatives of HSM, we do not find any reason  

to  pass  any order  on the aforesaid Interlocutory  

Applications  by  which  the  Bank  has  sought  

permission to withdraw the decretal  amount from  

the custodian concerned.  In view of the above, we  

are, therefore, of the view that these Interlocutory  

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applications  are  liable  to  be  dismissed  and  are  

accordingly, dismissed.   

5.         During  the argument, we are informed that  

Mr.Kuntal K. Sen, CIT (A), Central V, Mumbai, who  

has already heard out the appeal, is under transfer.  

Since we find that he has heard out the matter in  

detail  and only the matter is to be decided finally  

after hearing the heirs and legal representatives of  

the  HSM,  we feel  it  proper  that  Mr.Kuntal  K.Sen  

should be allowed to stay for a period of six months  

from this date  to hear out the Income Tax Appeal  

and  dispose  of  the  same  finally.   The  learned  

Additional  Solicitor  General  of  India,  Mr.Tripathi,  

appearing on behalf of the Income Tax Authorities  

as  well  as  Ms.Kamini  Jaiswal  jointly  submitted  

before us that  directions could be made to dispose  

of the Income Tax Appeal within four months from  

this date without granting any adjournment on any  

ground whatsoever.  Accordingly, we direct the CIT  

(A), Central V, Mumbai to dispose of the Income Tax  

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Appeal  pending  before  it  within  six  months  from  

this  date  without  granting  any  unnecessary  

adjournment whatsoever.

6.         Such being the position, we feel it proper to  

direct the authorities not to dislodge Mr. Kuntal K.  

Sen, CIT (A), Central V, Mumbai without the final  

decision  is  made by him as we are of the view that  

if a new incumbent takes over from Mr. Sen, then a  

denovo trial  has to be made, which would take a  

long time to dispose of the pending appeal.   

7.       With the aforesaid directions, pending C.A.No.  

2672  of  2009,  all  the  aforesaid  Interlocutory  

Applications  seeking  clarifications,  modifications  

and directions are  disposed of.   There  will  be  no  

order as to costs.  

……………………….J. [Tarun  Chatterjee]

New Delhi;      ………………… …….J.

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August 25, 2009.    [ R.M.Lodha]   

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