1969 (9) TMI 31 - HC - Income Tax

Valid attachment under Income-tax Act upheld despite errors; posthumous certificates excluded from attachment claim.

Isha Beevi And Others Versus Tax Recovery Officer And Others.

Isha Beevi And Others Versus Tax Recovery Officer And Others. - [1971] 80 ITR 82 Issues Involved:1. Validity of attachment under the Income-tax Act, 1961 for arrears due under the Travancore Income-tax Act.2. Validity of certificates issued after the death of the assessee.3. Attachment of properties transferred by gift deeds before the death of the assessee.Issue-wise Detailed Analysis:1. Validity of Attachment under the Income-tax Act, 1961 for Arrears Due under the Travancore Income-tax Act:The appellants contended that arrears under the Travancore Income-tax Act could only be recovered under that Act and not under the Income-tax Act, 1961. The court held that the Tax Recovery Officer had the authority to proceed under the Travancore Income-tax Act for recovery of arrears due under that Act, even though he cited the wrong provision of law. The court noted that the Indian Income-tax Act, 1922, extended to Travancore-Cochin State on April 1, 1950, did not provide for the recovery of arrears under the Travancore Act. However, the authority constituted under the Income-tax Act, 1961, was competent to recover arrears due under the Travancore Income-tax Act by virtue of section 8(1) of the General Clauses Act, which allows references to repealed provisions to be construed as references to re-enacted provisions. Therefore, the attachment under the Income-tax Act, 1961, was valid.2. Validity of Certificates Issued After the Death of the Assessee:The appellants argued that certificates issued after the death of Thangal Kunju Musaliar were void as there was no provision for issuing certificates in the name of a deceased assessee. The court agreed, stating that certificates must be issued against a living defaulter, and recovery cannot be made from legal representatives not named in the certificates. Rule 84 and Rule 85 of the Second Schedule to the Income-tax Act, 1961, imply that certificates must be against a living defaulter and provide for recovery only after the defaulter's death. Consequently, the Tax Recovery Officer could not proceed to recover amounts specified in these certificates.3. Attachment of Properties Transferred by Gift Deeds Before the Death of the Assessee:The appellants contended that properties transferred by gift deeds before the death of Thangal Kunju Musaliar should not have been attached as if they belonged to him at the time of his death. The court held that the revenue was entitled to proceed as if the properties belonged to the deceased at the time of his death. The appellants could file claims before the concerned authority and seek adjudication. The court noted that for part of the properties covered by one of the gift deeds, suits were filed, and the district court declared the gift deeds as not binding on the revenue. The proper forum for adjudicating the question regarding these properties was the court where appeals were pending. For properties not covered by suits, the appellants could file claim petitions and seek adjudication.Conclusion:The court declared that the claim enforceable under the attachment would not include arrears specified in the certificates issued after the death of Thangal Kunju Musaliar and modified the order to this extent. The writ appeals were dismissed, and no order as to costs was made.