Limitation on sale of attached property: delayed sale notice and attachment were time-barred under Rule 68B.

Rule 68B of the Second Schedule to the Income-tax Act limits the sale of immovable property attached for tax recovery to the prescribed period counted from the end of the financial year in which the demand-giving order becomes conclusive or final. Where the sale is not made within that time, the attachment is deemed to have been vacated unless a statutory exception applies. On the admitted facts, the demand had attained finality earlier, but the sale notice and attachment were issued after the limitation period, and no extension or exclusion of time was shown. The impugned sale notice and attachment were therefore time-barred and liable to be quashed.

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Issues: Whether the impugned sale notice and consequential attachment of the petitioner's immovable property were barred by limitation under Rule 68B of the Second Schedule to the Income-tax Act, 1961, and whether the attachment stood vacated on expiry of the prescribed period.

Analysis: Rule 68B prescribes a limitation period for sale of immovable property attached for recovery of tax dues, computed from the end of the financial year in which the demand-giving order becomes conclusive under section 245-I or final under Chapter XX. The provision also states that if the sale is not made in accordance with sub-rule (1), the attachment order is deemed to have been vacated on expiry of the limitation period. On the admitted facts, the demand had attained finality much earlier, while the attachment and proclamation of sale were issued long after the permissible period. The statutory exceptions extending or excluding time were not shown to apply.

Conclusion: The sale notice was time-barred, the attachment was deemed to have been vacated, and the impugned action was liable to be quashed. The writ petition was therefore allowed in favour of the assessee.

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