UTTAM DUTTAversusTHE CUSTODIAN AND ORS

           Digitally signed
           by SWAROOP
SWAROOP SHARAD
SHARAD
PHADKE
        PHADKE
        Date:
        2026.04.16
                                                                 26 spmal 94 of 2025.doc
           11:00:39 +0530




                                      IN THE SPECIAL COURT
                        (TRIAL OF OFFENCES RELATING TO TRANSACTIONS
                                     IN SECURITIES) ACT, 1992
                               MISC. APPLICATION (L) NO.94 OF 2025
                                                IN
                                 MISC. APPLICATION NO.32 OF 2009
                                               WITH
                                 MISC. APPLICATION NO.32 OF 2009
                                               WITH
                                INTERIM APPLICATION NO.8 OF 2025

Uttam Datta                                             …     Applicant
     versus
The Custodian and Ors.                                  …     Respondents

Mr. Uttam Datta – applicant in person present (through VC).
Mr. Gandhar Raikar with Ms. Shilpa Bhate (through VC), with Ms. Aditi
Pandey, Mrs. Payal Mehta, for Custodian.
Mr. Ashwin Mehta, for Notified parties.
Ms. Kinjal Kakkad i/by Mr. Vipul Shukla, for Respondent No.2.

                              CORAM:   N.J.JAMADAR, J.
                                       JUDGE, SPECIAL COURT

                              DATE :   10 APRIL 2026

ORDER :

SPMA(L) No.94 of 2025 :

1.           Heard the Applicant in person and the learned Counsel for the parties.

2.           This application is preferred seeking recall of the order dated 27

September 2013 dismissing Misc. Application No.32 of 2009 for want of

prosecution.

3.           The Applicant had preferred Misc. Application No.32 of 2009 for

certification of 100 shares of Reliance Petrochemicals Limited (R2) and for


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lifting the attachment qua the said shares. This Court was persuaded to

dismiss the said application for want of prosecution, as it was submitted on

behalf of the Custodian (R1) that, despite several communications, the

Applicant did not respond and the envelopes were returned back with the

remarks “Applicant not found”.

4.        The Applicant has filed this application in person. In this Application,

the applicant has ascribed justifiable reasons for condonation of delay in

seeking setting aside of the said order.          In view of the decision of the

Supreme Court in the case of L.S.Synthetics Ltd. V/s. Fairgrowth Financial

Services Ltd. and Anr.1, the provisions contained in the Limitation Act, do not

apply to the proceeding before the Special Court. Thus, as the Applicant

appears in person, and to advance the cause of substantive justice, this Court

is inclined to condone the delay in seeking setting aside of the dismissal order

and also set aside the order dated 27 September 2013 and restore Misc.

Application No.32 of 2009 for decision on merits.

5.        The Misc. Application (L) No.94 of 2025 stands allowed.

6.        The order dated 27 September 2013 in Misc.Application No.32 of 2009

stands recalled.

7.        Misc. Application No.32 of 2009 stands restored to file.




1     (2004) 11 SCC 456

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       Misc. Application No.32 of 2009

8.    This is an application for certification of 100 shares of Reliance

Petrochemicals      Limited   (R2),   bearing   Folio   No.5889183,    Certificate

No.05132866 and having distinctive Numbers 234730050 to 234730149,

lifting attachment of the subject shares, and to direct the Custodian (R1) and

RPL (R2) to release the subject shares along with all the accruals and

dividend thereon.

9.    The Applicant avers that, on 4 March 1992, the applicant had

purchased 100 shares of RPL (R2) through Mr. Nagar Mull Kejriwal, a

member of the Calcutta Stock Exchange for a consideration of rs.2,400/-. The

Applicant has submitted the original share certificates and the transfer deeds.

The original share certificates stand in the name of Ms. Deepika Ashwin

Mehta and Mr. Ashwin S. Mehta – the notified parties (R6 and R5,

respectively).

10.   The Applicant claims that the applicant had lodged the shares for

transfer with Reliance Consultancy Services Limited, the then Registrar and

Transfer Agent of RPL (R2). However, vide communication dated 14 August

1992, the original share certificates and the transfer deed were returned on

the ground that the subject shares were under attachment by the Custodian /

Income Tax Department.

11.   The Custodian has filed a Certification Report. It is contended, inter


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alia, that the application was examined in accordance with the criteria laid

down in Misc. Application Nos.1, 2 and 3 of 1992. Apart from the original

share certificates and the photocopy of the bill/receipt issued by the stock

broker, the Applicant has not produced other requisite documents, namely, the

contract note, proof of payment of consideration, proof of delivery in stock

exchange and proof of price not being lower than the lowest ruling price on

the date of purchase in the Calcutta Stock Exchange.       Since the applicant

claims that he had paid the price of the shares in cash, it cannot be said that

the applicant has submitted the proof of payment.

12.   The Applicant in person submitted that, the transaction was genuine

and he is a bonafide purchaser of the subject shares for valuable

consideration. Reliance was placed on the transfer deeds to demonstrate that

the notified Parties had transferred the subject shares and the said fact is

evident from the names of the successive brokers, which find mention on the

transfer deeds. The Petitioner in person also banked upon the bill issued by

Mr. Nagar Mull Kejriwal, the stock broker, which evidences the receipt of

consideration by the stock broker.

13.   In opposition to this, Mr. Raikar, learned Counsel for the Custodian,

would submit that the documents produced by the Applicant are not sufficient

to certify the applicant as a bonafide purchaser of the subject shares. It was

urged that, mere production of share certificates and share transfer forms, in


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the absence of contemporaneous documents, like the contract note, bill /

receipt issued by the stock broker, and more importantly, proof of payment is

of no assistance to the applicant. Mr. Raikar laid emphasis on the fact that

the absence of proof of payment dents the claim of the applicant as proof of

payment is sacrosanct.

14.     Under the Scheme of the Trial of Offences Relating to Transactions in

Securities Act, 1992 (“the TORT Act, 1992”), with the notification of a party

under sub-Section (2) of Section 3, the entire property of such notified party

stands attached, simultaneously and automatically, under sub-Section (3) of

Section 3 of the Act, 1992. The attachment of the property of the notified party

is by operation of law. No formal order of attachment is necessary. Neither the

situs of the property nor the identity of the person who holds the property, has

any bearing on the statutory attachment. The entire property of the notified

party stands attached and, once attached, can only be dealt with in the

manner ordained by the Act, 1992 and by the orders of the Special Court.

15.   The procedure of certification was necessitated as the attachment of

the property of a notified party, which also comprised genuine and bona fide

share holdings of small investors, was causing enormous hardship to such

small investors. To ameliorate the hardship of genuine and bona fide small

time investors, by its order dated 27 July 1997 passed in MA Nos.1 of 1992, 2

of 1992 and 3 of 1992, this Court had delineated the parameters for


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certification of securities as bona fide and genuine acquisitions, and release

the same from attachment.

16.   This Court has further clarified that the process of certification was to

be followed in respect of settlement dated 6 June 1992 onwards. The case at

hand falls within the window period as the applicant claimed to have

purchased the subject shares on 4 March 1992. Indeed, this Court had

delineated the procedure for certification of shares and the documents which

are required to be submitted to substantiate the claim of being a bona fide

purchaser of the attached shares for value. The absence of the contract note,

bills/receipts and proof of payment, was sought to be accounted for by

asserting that the Applicant had lost those documents.

17.   The veracity of the aforesaid claim may be debatable. However, the

Court would be required to be examine whether the documents which have

been produced by the Applicant make out a case that the Applicant appeared

to be a bona fide purchaser of the subject share.

18.   Mr. Raikar was justified in canvassing a submission that, mere

possession of the original share certificate and the transfer forms, may not, by

itself, substantiate the claim of a party who seeks a declaration that he has a

bonafide purchaser of the shares, to which the certificate relates.

19.   In the case at hand, however, there are contemporaneous documents

and concomitant circumstances, which deserve to be taken into account. The


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communication dated 14 October 1992 addressed by Reliance Consultancy

Services Limited – the Registrar and Share Transfer Agent, indicates that the

applicant had lodged 100 shares of RPL (R2) for transfer and those shares

were returned to the applicant with the remarks “the subject shares were the

subject matter of the attachment by Custodian / Income Tax department”.

20.   It is imperative to note that, all the particulars of the shares in respect of

which the applicant had sought transfer, namely, the certificate number,

number of shares, distinctive numbers and number of transfer deed

correspond with the numbers which find mention on the original share

certificates and the transfer deed. The aforesaid communication dated 14

October 1992, which has an element of contemporaneous value, in my

considered view, cannot be brushed aside lightly.                  The aforesaid

communication establishes, three facts. First, the Applicant had lodged the

original share certificate, along with the transfer deed for transfer of the

subject shares. Second, the share certificate and the transfer deed were then

in existence. Third, the entries in the transfer deed, the number of which finds

mention in the letter dated 14 October 1992, vouches for the execution of the

transfer deed by the erstwhile holder of the shares – notified parties (R5 and

R6). In a sense, the letter dated 14 October 1992, constitutes a formidable

dyke against the applicant not being a bona fide purchaser of the subject

shares. It does not appear that the applicant has lodged the claim for the


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mere reason that the applicant is in possession of the subject shares.

21.   The contemporaneous correspondence indicates that, after the

acquisition of the subject shares, the applicant had sought transfer of shares,

within a reasonable time, and, at that point of time, Reliance Consultancy

Services Limited had informed the applicant that the subject shares were

under attachment.      I am, therefore, persuaded to hold that the said

communication dated 14 October 1992 singularly vouches for the

genuineness of the transaction and the bonafide of the applicant.

22.   The aspect of delay is, indeed, relevant. However, it is also necessary

to note that the applicant had initially filed the application in the year 2009,

which was dismissed for want of prosecution. Therefore, it cannot be said

that the claim of the Applicant was then decided on merits.

23.   The transfer deed also lends credence to the claim of the applicant. It

appears that the original allottees of the shares – notified parties (R5 and R6)

had executed the transfer deed. The shares changed the hands on a couple

of occasions, before the name of Mr. Nagar Mull Kejriwal, the stock broker,

through whom the applicant claimed to have purchased shares, came to be

endorsed as the last delivery broker. Mr. Nagar Mull kejriwal has issued a bill

dated 4 March 1992 acknowledging the receipt of the said amount.

Cumulatively, the transfer deed and the receipt lend support to the claim of

the applicant.


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24.   Thus, this court is satisfied that the applicant is a bonafide purchaser of

the subject shares. The application, therefore, deserves to be allowed.

25.   Hence, the following order :

                                          ORDER

      (i)     The prayer for certification of 100 shares bearing Certificate

Nos.05132866, Distinctive Numbers 2347300500 to 234730149 under Folio

No.58891983 of the Reliance Petrochemicals Limited (R2) stands allowed.

      (ii)    The Custodian (R1) shall take necessary steps to transfer the

subject 100 shares standing in the name of the notified parties along with all

accruals and dividends, as indicated in paragraph No.14 of the Certification

Report, in favour of the Applicant, within a period of eight weeks from today.

      (iii)   The Application stands disposed.

      (iv)    Interim application No.8 of 2025 also stands disposed.



                                                  ( N.J.JAMADAR, J. )




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