Limitation for sale of attached property under Rule 68B requires a stay; mere pending application does not stop time.

Rule 68B of the Second Schedule to the Income-tax Act requires sale of attached immovable property to be completed within the prescribed limitation period from the date the demand becomes final or conclusive. Time is excluded under rule 68B(2) only when the relevant levy, attachment, sale, or appeal proceedings are stayed as contemplated by the rule. Mere pendency of a miscellaneous application, without any stay of recovery or sale, does not extend limitation. Because the demand had attained finality on 15 June 1994 and the sale took place on 30 March 2004, the sale was beyond time and invalid, and confirmation of sale was liable to be set aside.

---

---

Issues: Whether the sale of the attached immovable property was valid when effected beyond the period prescribed under rule 68B of the Second Schedule to the Income-tax Act, and whether the pendency of the miscellaneous application before the Tribunal excluded time from computation of limitation.

Analysis: Rule 68B requires sale of an attached immovable property to be completed within the prescribed limitation period counted from the date on which the demand becomes final or conclusive. The exclusion clauses in sub-rule (2) apply only where the levy, attachment, sale, or appeal proceedings are stayed in the manner contemplated by the rule. The miscellaneous application filed by the assessee did not seek, and did not obtain, any stay of recovery or sale. Mere pendency of that application therefore did not attract any exclusion under rule 68B(2). The demand attained finality on 15 June 1994, and the sale held on 30 March 2004 was beyond the permissible period.

Conclusion: The sale was invalid, and the challenge to the confirmation of sale succeeded.

Final Conclusion: The attached property could not be validly sold after expiry of the limitation prescribed by rule 68B, and the sale confirmation was liable to be set aside.

Ratio Decidendi: Mere pendency of an application that does not stay recovery, attachment, or sale does not exclude time under rule 68B; if the sale is not completed within the prescribed period, the attachment stands vacated and the sale is invalid.

---