1 IN THE HIGH COURT OF JUDICATURE AT BOMBAY ORDINARY ORIGINAL CIVIL JURISDICTION jmi NOTICE OF MOTION NO.2636 OF 2009 IN SUIT NO. 77 OF 2009. Shri Madhavlal Narayanlal Pittie & Ors. ..Plaintiffs. vs. Bachhraj & Company Pvt. Ltd. & Ors. ..Defendants. And The Deputy Commissioner, Range III, Mumbai, DCIT, Circle 3(1). ..Respondent. .... Mr. Ashish Kamath, i/b. Cr. Bayley & Co., for Plaintiff. Mr. Vishesh Malviya, i/b. Fed. & Rashmikant, for Defendant No.2. Mr. Sharan Jagtiani, a/w. Mr. Baptist D’Souza, i/b. Malvi Ranchoddas & Co., for Defendant Nos. 1 & 3 to 6. Mr. J.S. Saluja, for Respondent. Mr. Dharam Veer Singh, Deputy C.I.T., Circle 3(1), present in person. .... CORAM : S.J.KATHAWALLA, J. DATE : 12TH OCTOBER 2009. P.C. This notice of motion is taken out by the original defendant nos.1 and 3 to 6 seeking directions against the Indian Bank to issue TDS certificate for the tax deducted at source on the interest and/ or on the monies deposited in this Court by defendant no.6 and for directions against the Indian Bank to ensure such TDS certificate 2 shall contain the PAN no. of defendant no.6 which shall be furnished to the said bank by defendant no.6. 2. This notice of motion is opposed by the plaintiffs. It is submitted by the plaintiffs that notice of motion no. 305 of 2009 was filed by the plaintiffs for restraining and or injuncting the defendant no.1 and/or defendant nos. 2 to 5 from in any manner seeking to sell, transfer, alienate, create third party rights/interests and/or otherwise convey defendant no.1’s right, title and/or interest in the suit shares, i.e. 3,46,96,250 shares of Bajaj Hindustan Limited and/or any part thereof to defendant no.6, his representatives/nominees and/or any other member and/or entity of the Bajaj Group and/ or otherwise whatsoever. In the said motion, under an order dated 29 th December 2008 passed by this Court, defendant nos. 3 and 6 undertook to deposit market value of the suit shares as on 1 st March 2008, less the price obtained under the impugned sale, to the extent of 12.5% i.e. the plaintiffs shareholding in the defendant no.1. Pursuant thereto defendant no.6 deposited a sum of Rs.79,12,91,352/- in this Court, 3 which has been subsequently invested in a fixed deposit with Indian Bank. It is submitted that the defendant no.6 who by the present notice of motion is seeking the issue of a TDS certificate in his favour, in respect of the interest accruing on the said deposit cannot be allowed to do so, because the amount deposited by the respondent no.6 in this Court is in the nature of security, for the purpose of securing the claim of the plaintiffs in the suit. The character and/or title of the money deposited by defendant no.6 is not yet determined and presently defendant no.6 does not have any entitlement to the said moneys. 3. The above submissions on the part of the plaintiffs were denied/disputed by defendant no.6. Keeping in mind the fact that the order passed herein may affect several matters where pursuant to the directions of the Court, amounts deposited with the Court are invested and interest has accrued on the said amounts the applicants were directed to join the Deputy Commissioner, Range III, Mumbai, DCIT, Circle 3(1) to the present notice of motion with a further 4 direction to the Deputy Commissioner to remain present in Court in person or through his representative. Pursuant to such directions, the Deputy Commissioner of Income Tax, Circle 3(1) has filed his affidavit dated 12 th October 2009. In paragraphs 2 and 3 of his affidavit, the Deputy Commissioner of Income Tax has submitted as under :- “2. I say that, in so far as the said deposit of Rs. 79,12,91,352/-, which is kept in fixed deposit with the Indian Bank initially for a period of 46 days pursuant to the direction of this Hon’ble Court is concerned, Defendant no.6 must have reflected in his returns, as deposit, in terms of the said orders of the Hon’ble Court and further, the said amount to continue remaining as deposit until further orders of the Hon’ble Court. Similarly, the interest accrued on the said amount is also being added on to the principle on every renewals after 46 days, the same will be treated as deposit added on to 5 the said principle amount of Rs.79,12,91,352/-. Likewise, the TDS which is being deducted on the interest accrued after each expiry of 46 days, the credit of said TDS can be claimed by either of parties in whose favour the said money crystallizes. 3. I further submit that until the final orders of this Hon’ble Court, Defendant no.6 may simply reflect the said principle amount as deposit in the High Court in terms of the orders of the Court, in the event if defendant no.6 has not done. The said amount of Rs.79,12,91,352/- kept as deposit in the Court by the defendant no.6 and the interest accrued thereon, will be treated as deposit and the same will be assessed by the I.T. Deptt. for tax purpose depending upon the final order of the Court.” 4. The Deputy Commissioner of Income Tax has therefore made it clear that an amount of Rs.79,00,00,000/- alongwith accrued interest deposited by the applicants in this Court is being treated as 6 the deposit in this Court and is not treated as income of any individual. The defendant no.6 shall also continue to show the said amount as a deposit with this Court. The interest accrued on the original sum deposited is also not to be treated as income. 5. In view of the aforesaid clarifications from the Deputy Commissioner of Income Tax in his affidavit dated 12 th October 2009, no orders are required to be passed as sought by the applicant and the notice of motion is accordingly disposed of. [ S.J.KATHAWALLA, J. ]