TaxTMI 
TaxTMI 
THE FIFTH SCHEDULE - PROCEDURE FOR RECOVERY OF TAX
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....rom the date of service of the notice. (2) The notice under sub-rule (1) shall also intimate to the defaulter that steps would be taken to realize the amount under this Schedule, if he defaults to make payment within the time specified therein. When certificate may be executed. 3. (1) No step in execution of a certificate shall be taken until the period of fifteen days has elapsed since the date of the service of the notice required by the preceding rule. (2) However, the Tax Recovery Officer may attach the whole, or any part, of the movable property of the defaulter, as would be liable to attachment in execution of a decree of a civil court, within the said period of fifteen days if,- (a) he is satisfied, for reasons to be recorded in writing, that the defaulter is likely to conceal, remove or dispose of the whole, or any part, of the movable property; and (b) the realization of the amount of the certificate would in consequence be delayed or obstructed. (3) The defaulter whose property has been so attached may furnish security to the satisfaction of the Tax Recovery Officer and on such acceptance of the security by the Tax Recovery Officer, the attachment shall be ....
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....Officer in the manner laid down in this Schedule, on the ground that the purchase was made on behalf of the plaintiff or on behalf of some one through whom the plaintiff claims. (2) Nothing in this section shall bar a suit to obtain a declaration that the name of any purchaser certified as aforesaid was inserted in the certificate fraudulently or without the consent of the real purchaser, or interfere with the right of a third person to proceed against that property, though ostensibly sold to the certified purchaser, on the ground that it is liable to satisfy a claim of such third person against the real owner. Disposal of proceeds of execution. 8. (1) Whenever assets are realised by sale, or otherwise, in execution of a certificate, the proceeds shall be disposed of in the following manner, namely :- (a) they shall first be adjusted towards the amount due under the certificate in execution of which the assets were realised and the costs incurred in the course of such execution; (b) if there remains a balance after the adjustment referred to in clause (a), the same shall be utilised for satisfaction of any other amount recoverable from the assessee under this Act which m....
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.... (b) (in the case of movable property) at the date of the attachment. (5) The Tax Recovery Officer shall make an order releasing the property, wholly or to such extent as he thinks fit, from attachment or sale if, upon the said investigation, he is satisfied that, for the reason stated in the claim or objection, such property- (a) was not, at the said date, in the possession of the defaulter or of some person in trust for him; (b) was not in the occupancy of a tenant or other person paying rent to the defaulter; or (c) being in the possession of the defaulter at the said date, it was so in his possession, not on his own account or as his own property, but on account of or in trust for some other person, or partly on his own account and partly on account of some other person, . (6) The Tax Recovery Officer shall disallow the claim, if, for reasons to be recorded in writing, he is satisfied that the property was (a) at the said date, in the possession of the defaulter as his own property and not on account of any other person; (b) in the possession of some other person in trust for the defaulter, or (c) in the occupancy of a tenant or other person paying rent to ....
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....ery sale shall be stopped if, before the lot is knocked down, the arrears and costs (including the costs of the sale) are tendered to the officer conducting the sale, or proof is given to his satisfaction that the amount of such arrears and costs has been paid to the Tax Recovery Officer who ordered the sale. Private alienation to be void in certain cases. 16. (1) Where a notice has been served on a defaulter under rule 2, the defaulter, or his representative in interest, shall not be competent to mortgage, charge, lease or otherwise deal with any property belonging to him except with the permission of the Tax Recovery Officer, nor shall any civil court issue any process against such property in execution of a decree for the payment of money. (2) Where an attachment has been made under this Schedule, any private transfer, or delivery, of the property attached or of any interest therein and any payment to the defaulter of any debt, dividend or other moneys contrary to such attachment, shall be void as against all claims enforceable under the attachment. Prohibition against bidding or purchase by officer. 17. No officer or other person having any duty to perform in connec....
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.... referred in sub-rule (1) may sell the property seized at once, if- (a) the property seized is subject to speedy and natural decay; or (b) the expense of keeping the seized property in custody is likely to exceed its value. Agricultural produce. 25. (1) Where the property to be attached is agricultural produce the attachment shall be made by affixing a copy of the warrant of attachment- (a) where such produce is growing crop,-on the land on which such crop has grown; or (b) where such produce has been cut or gathered,-on the threshing floor or place for treading out grain or the like, or fodder-stack, on or in which it is deposited; (2) A copy of warrant of attachment, where the property to be attached is agricultural produce, shall also affixed on the outer door or on some other conspicuous part of the house in which the defaulter ordinarily resides, or with the leave of the Tax Recovery Officer, on the outer door or on some other conspicuous part of the house in which he- (a) carries on business or personally works for gain; or (b) is known to have last resided or carried on business or personally worked for gain. (3) Upon affixing the copy of warrant, unde....
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....ng from transferring the same or receiving any dividend thereon; (c) in the case of the other movable property (except as aforesaid)-the person in possession of the same from giving it over to the defaulter. (2) A copy of such order shall be affixed on some conspicuous part of the office of the Tax Recovery Officer, and another copy shall be sent, in the case of the debt, to the debtor, in the case of the share, to the proper officer of the corporation, and in the case of the other movable property (except as aforesaid), to the person in possession of the same. (3) A debtor prohibited under clause (i) of sub-rule (1) may pay the amount of his debt to the Tax Recovery Officer, and such payment shall discharge him as effectually as payment to the party entitled to receive the same. Attachment of decree. 28. (1) The attachment of a decree of a civil court for the payment of money, or for sale in enforcement of a mortgage or charge, shall be made by the issue to the civil court of a notice requesting the civil court to stay the execution of the decree unless and until- (a) the Tax Recovery Officer cancels the notice; or (b) the Tax Recovery Officer, or the defaulter, ap....
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.... be attached consists of an interest of the defaulter, being a partner, in the partnership property, the Tax Recovery Officer may make an order charging the share of such partner in the partnership property and profits with payment of the amount due under the certificate. (2) The Tax Recovery Officer may, by the order referred to in sub-rule(1) or any subsequent order, appoint a receiver of the share of such partner in the profits, whether already declared or accruing and of any other money which may become due to him in respect of the partnership, and direct accounts and inquiries and make an order for the sale of such interest or such other order as the circumstances of the case may require. (3) The other persons shall be at liberty at any time to redeem the interest charged or, in the case of a sale being directed, to purchase the same. Inventory. 34. In the case of attachment of movable property by actual seizure, the officer shall, after attachment of the property, prepare an inventory of all the property attached, specifying in it the place where it is lodged or kept, and shall forward the same to the Tax Recovery Officer and a copy of the inventory shall be delivered....
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....rom the date on which a copy of the sale proclamation was affixed in the office of the Tax Recovery Officer. Sale of agricultural produce. 42. (1) Where the property to be sold is agricultural produce, the sale shall be held,- (a) if such produce is a growing crop-on or near the land on which such crop has grown, or (b) if such produce has been cut or gathered-at or near the threshing floor or place for treading out grain or the like, or fodder-stack, on or in which it is deposited. (2) However, the Tax Recovery Officer may direct the sale to be held at the nearest place of public resort, if he is of opinion that the produce is thereby likely to sell to greater advantage. (3) The sale shall be postponed, where, on the produce being put up for sale,- (a) a fair price, in the estimation of the person holding the sale, is not offered for it, and (b) the owner of the produce, or a person authorised to act on his behalf, applies to have the sale postponed till the next day or, if a market is held at the place of sale, the next market day. (4) When the sale has been postpone under sub-rule (3), it shall be then completed on the date postponed regardless of any price o....
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....47. The Tax Recovery Officer may, regardless of anything to the contrary contained in this Schedule, authorise the sale of any property, which is a negotiable instrument or a share in a corporation, through a broker instead of directing the sale to be made by public auction. Order for payment of coin or currency notes to the Assessing Officer. 48. Where the property attached is current coin or currency notes, the Tax Recovery Officer may, at any time during the continuance of the attachment, direct that such coins or notes shall be credited to the Central Government and the amount so credited shall be dealt with in the manner specified in rule 8. PART III ATTACHMENT AND SALE OF IMMOVABLE PROPERTY ATTACHMENT Attachment. 49. Attachment of the immovable property of the defaulter shall be made by an order prohibiting the defaulter from transferring, or charging, the property in any way and prohibiting all persons from taking any benefit under such transfer or charge. Service of notice of attachment. 50. A copy of the order of attachment shall be served on the defaulter. Proclamation of attachment. 51. The order of attachment shall be proclaimed at some place on, or ad....
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.... Time of sale 56. No sale of immovable property under this Schedule shall, without the consent in writing of the defaulter, take place until after the expiration of at least thirty days calculated from the date on which a copy of the proclamation of sale has been affixed on the property or in the office of the Tax Recovery Officer, whichever is later. Sale to be by auction 57. (1) The sale shall be by public auction to the highest bidder and shall be subject to confirmation by the Tax Recovery Officer. (2) However, no sale under this rule shall be made, if the amount bid by the highest bidder is less than the reserve price, if any, specified under clause (d) of rule 54. Deposit by purchaser and resale in default. 58. (1) On every sale of immovable property, the person declared to be the purchaser shall pay, immediately after such declaration, a deposit of twenty-five per cent on the amount of his purchase money, to the officer conducting the sale; and, in default of such deposit, the property shall forthwith be resold. (2) The full amount of purchase money payable shall be paid by the purchaser to the Tax Recovery Officer on or before the fifteenth day from the date....
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....an application under this rule. Application to set aside sale of immovable property on ground of non-service of notice or irregularity. 62. (1) Where immovable property has been sold in execution of a certificate, such Income-tax Officer as may be authorised by the Chief Commissioner or Commissioner in this behalf, the defaulter, or any person whose interests are affected by the sale, may, at any time within thirty days from the date of the sale, apply to the Tax Recovery Officer to set aside the sale of the immovable property on the ground- (a) that notice was not served on the defaulter to pay the arrears as required by this Schedule; or (b) of a material irregularity in publishing, or conducting, the sale. (2) No sale shall be set aside on any ground referred to in sub-rule (1) unless the Tax Recovery Officer is satisfied that the applicant has sustained substantial injury by reason of the non-service or irregularity. (3) An application made by a defaulter under this rule shall be disallowed unless the applicant deposits the amount recoverable from him in the execution of the certificate. Setting aside sale where defaulter has no saleable interest. 63. At any ti....
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....in a period to be mentioned therein, and regardless anything contained in this Schedule, to make the proposed mortgage, lease or sale. (3) All moneys payable under the mortgage, lease or sale referred to in sub-rule (2) shall be paid to the Tax Recovery Officer and not to the defaulter. (4) No mortgage, lease or sale under this rule shall become absolute until it has been confirmed by the Tax Recovery Officer. Fresh proclamation before re-sale. 68. Every re-sale of immovable property, in default of payment of the purchase money within the period allowed for such payment, shall be made after the issue of a fresh proclamation in the manner and for the period hereinbefore provided for the sale. Bid of co-sharer to have preference. 69. Where the property sold is a share of undivided immovable property, and two or more persons, of whom one is a co-sharer, respectively bid the same sum for such property or for any lot, the bid shall be deemed to be the bid of the co-sharer. Acceptance of property in satisfaction of amount due from the defaulter. 70. (1) Without prejudice to the provisions contained in this Part, an Assessing Officer, duly authorised by the Chief Commissio....
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....r injunction of any court; (b) the period during which the proceedings of attachment or sale of the immovable property are stayed by an order or injunction of any court; or (c) the period commencing from the date of the presentation of any appeal against the order passed by the Tax Recovery Officer under this Schedule and ending on the day the appeal is decided. (4) Where immediately after the exclusion of the period referred in sub-rule (3), the period of limitation for the sale of the immovable property is less than 180 days, such remaining period shall be extended to 180 days and the aforesaid period of limitation shall be deemed to be extended accordingly. (5) Where the sale of immovable property is not made in accordance with the provisions of sub-rule (1), the attachment order in relation to the said property shall be deemed to have been vacated on the expiry of the time of limitation specified under this rule. PART IV APPOINTMENT OF RECEIVER Appointment of receiver for business. 72. (1) Where the property of a defaulter consists of a business, the Tax Recovery Officer may attach the business and appoint a person as receiver to manage the business. (2) Attac....
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....or has had since the drawing up of the certificate by the Tax Recovery Officer, the means to pay the arrears or some substantial part thereof and refuses or neglects or has refused or neglected to pay the same. (3) A warrant for the arrest of the defaulter may, regardless of anything contained in sub-rule (1), be issued by the Tax Recovery Officer, if he is satisfied, by affidavit or otherwise, that the defaulter is likely to abscond, or leave the local limits of the jurisdiction of the Tax Recovery Officer, with the object, or effect, of delaying the execution of the certificate. (4) The Tax Recovery Officer may issue a warrant for the arrest of the defaulter if appearance is not made in obedience to a notice issued and served under sub-rule (1). (5) A warrant of arrest issued by a Tax Recovery Officer under sub-rule (3) or sub-rule (4) may also be executed by any other Tax Recovery Officer within whose jurisdiction the defaulter may for the time being be found. (6) Every person arrested in pursuance of a warrant of arrest under this rule shall be brought before the Tax Recovery Officer issuing the warrant as soon as practicable and in any event within twenty-four hours of....
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....eing paid to the officer-in-charge of the civil prison, or (b) on the request of the Tax Recovery Officer on any ground other than the grounds mentioned in rules 78 and 79. (3) A defaulter released from detention under this rule shall not,- (a) be discharged from his liability for the arrears merely by reason of his release; and (b) be liable to be rearrested under the certificate in execution of which he was detained in the civil prison. Release 81. (1) The Tax Recovery Officer may order the release of a defaulter who has been arrested in execution of a certificate upon being satisfied that- (a) he has disclosed the whole of his property and has placed it at the disposal of the Tax Recovery Officer; and (b) he has not committed any act of bad faith. (2) The Tax Recovery Officer may order the rearrest of the defaulter in execution of the certificate, if he has ground for believing the disclosure made by the defaulter under sub-rule (1) to have been untrue. (3) However, the period of the detention of the defaulter in the civil prison shall not in the aggregate exceed that authorised by rule 77. Release on ground of illness. 82. (1) The Tax Recovery Officer....
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....Officer or other officer acting under the provisions of this Schedule shall have the powers of a civil court while trying a suit for the purpose of receiving evidence, administering oaths, enforcing the attendance of witnesses and compelling the production of documents. Continuance of certificate. 87. No certificate shall cease to be in force by reason of the death of the defaulter. Procedure on death of defaulter. 88. The proceedings under this Schedule (except arrest and detention) may be continued against the legal representative of the defaulter, and the provisions of this Schedule shall apply as if the legal representative were the defaulter, if the defaulter dies, at any time, after the certificate is drawn up by the Tax Recovery Officer. Appeals. 89. (1) An appeal from any original order passed by the Tax Recovery Officer under this Schedule, not being an order which is conclusive, shall lie to the Chief Commissioner or Commissioner. (2) Every appeal under this rule must be presented within thirty days from the date of the order appealed against. (3) Pending the decision of any appeal, execution of the certificate may be stayed if the appellate authority so d....