J. N. PATEL, J. : - The petitioner has challenged the legality, validity and propriety of the order dated 21 - 10 - 1995 passed by the respondent No.2, i.e. Annexure II and IV and the proceedings initiated by respondent No.2 as per Annexures . II and IV by passing order dated 21 - 10 - 1995 and 7 - 12 - 1995 respectively calling upon the petitioner to clear off the arrears of E.S.I. dues of M/s J. J. Cold Tread, Nagpur, petitioner having purchased land and building of the above employer from Maharashtra State Financial Corporation on the ground that the said transfer is a deemed transfer as per the provisions contained in section 29(2) of State Financial Corporation Act, 1951 for the purpose of section 93 - A of the E.S.I. Act as amended, otherwise coercive action was contemplated against him in accordance with the provisions contained in section 45 - C to 45 - 1 of E.S.I. Act, 1948 as amended and II Schedule to the Income - Tax Act read with section 45 - H of ESI Act, 1948. It is the case of the petitioner that it is a registered firm and deals with the business of manufacturing hydraulic pneumatic seals and as they were looking out for premises for their business purpose, in response to the auction sale conducted by respondent Nos. 3 and 4, the petitioner purchased plot U - 149 in the Nagpur industrial area of MIDC within the limits of village Nildoh, Tq. Hingna, District Nagpur. The petitioner having given the highest offer, the same was accepted by respondent Nos. 3 and 4 and the said plot along with the building was sold by respondent Nos. 3 and 4 in favour of the petitioner through registered sale - deed dated 26 - 6 - 1995.

2. It is the case of the petitioner that earlier this property was owned by M/s J.J. Cold Tread, Nagpur who were dealing in the business of remoulding of tyres in the said property. The said M/s. J. J. Cold Tread was a defaulter of respondent Nos. 3 and 4 and, therefore, respondent Nos. 3 and 4 attached and sold their assets for a consideration of Rs. 7,00,000/ - by virtue of powers vested in it under the State Financial Corporation Act, 1951 after giving notice under section 29 of the State Financial Corporation Act, 1951 and following the procedure and, therefore, the petitioner being the highest bidder, they have purchased the said plot along with the building free from all encumbrances by registered sale - deed executed in their favour by respondent Nos. 3 and 4 which is Annexure I to the petition.

3. According to the petitioner, they were surprised to receive the communication dated 21 - 10 - 1995 from the respondent No.2 along with the demand notice issued against the petitioner, i.e. Annexure II that the assets of M/s J.J. Cold Tread, Nagpur have been taken over by the petitioner, as such the arrears of the E.S.I. dues which were outstanding against the said J.J. Cold Tread, Nagpur have to be paid by the petitioner. The petitioner immediately responded to the demand notice and informed the respondent No.2 that they have purchased the property of M/s J. J. Cold Tread, Nagpur in an auction sale conducted by respondent Nos. 3 and 4 in accordance with the section 29(2) of the S.F.C. Act, 1951 and M/s J.J. Cold Tread, Nagpur was not privy to the said transfer and, therefore, for the purpose of section 93 - A of the E.S.1 Act, this cannot be considered as a transfer by the previous employer to the petitioner and they cannot be fastened with the liability to pay arrears of ESI dues and the recovery action of which they were threatened in the subsequent notice of demand is uncalled for. This was not accepted by the respondent No. 2 and the respondent No.2 took coercive action for recovery of the dues against the petitioner and vide their order dated 9 - 2 - 1996 informed the petitioners Bank, i.e. State Bank of India, Ramdaspeth, Nagpur prohibiting and restraining the petitioner from operating the account and forward the ESI dues amounting to Rs