Court denies certiorarified mandamus, emphasizes strict conditions for certificate under Income-tax Act

VM Dakhinamoorthy Mudaliar Versus Tax Recovery Officer And Others

VM Dakhinamoorthy Mudaliar Versus Tax Recovery Officer And Others - [1993] 202 ITR 946 Issues:
- Petition for certiorarified mandamus to quash an order and grant certificate under section 230A of the Income-tax Act.
- Discrepancies in arrears calculation and property value.
- Refusal of certificate issuance due to outstanding arrears.
- Argument for certificate issuance to facilitate property sale and arrears payment.
- Court's analysis of section 230A and inability to direct certificate issuance.
- Suggestion for mortgaging property to pay arrears.
- Direction to approach Commissioner of Income-tax with a concrete proposal.

Analysis:
The petitioner sought a certiorarified mandamus to quash an order and direct the issuance of a certificate under section 230A of the Income-tax Act for the sale of a property. The petitioner had previously approached the court in a similar matter, but the Assistant Commissioner of Income-tax refused to grant the certificate due to outstanding arrears and non-compliance with previous orders. The petitioner claimed discrepancies in arrears calculation and property value, offering not to sell the property until the case was resolved. The court noted the total arrears and interest due, amounting to Rs. 54,50,310, and the petitioner's argument that a certificate would enable the property's sale to pay off the arrears.

The court analyzed section 230A and cited the principle that a certificate could only be issued if certain conditions were met, emphasizing the need for Income-tax Officer satisfaction as per the Act. The court referenced legal precedent to support its interpretation of the section, stating that a certificate could not be granted in the current situation. Despite the petitioner's proposal to mortgage the property to pay arrears, the court found it unlikely for the petitioner to clear all arrears even with a certificate. The court highlighted the petitioner's non-compliance with previous orders and suggested approaching the Commissioner of Income-tax with a concrete proposal for mortgage and arrears payment.

In conclusion, the court directed the petitioner to present a mortgage proposal to the Commissioner of Income-tax, emphasizing the need for a person willing to pay the entire arrears. The court stayed the proclamation of the property sale pending the petitioner's proposal submission and ordered the third respondent to consider the proposal and make a decision by a specified date. The court aimed to balance the interests of the Revenue and the petitioner by providing an opportunity to resolve the arrears issue through a concrete proposal.