1997 (5) TMI 3

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....e decree-holders sought to attach various sums of money which were lying to the credit of the said judgment-debtors in the Court of Civil Judge, Agra, in Suit No. 76 of 1979. The decree-holders moved an application for rateable distribution under section 73 of the Code of Civil Procedure. In the present case, we are concerned with such application moved by the appellant. On May 28, 1973, the Civil Judge, Agra, had sent cheques to the executing court, viz., the Civil and Sessions Judge, Agra, for payment to the decree-holders, including the appellant, after taking security from them. On August 31, 1973, respondent No. 1-Union of India, moved an application under section 226(4) of the Income-tax Act, 1961 (hereinafter referred to as the "Act"....

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....iving rise to such liabilities has been quashed. On behalf of respondent No. 1, it was pointed out that the demand in respect of which the application under section 226(4) had been filed consisted of not only the liabilities of income-tax but also those under the Excess Profits Tax Act. The High Court did not consider it necessary to deal with the said question and left the appellant to have the controversy determined by the executing court. The High Court has allowed the revision petition and has set aside the order dated March 4, 1974, passed by the executing court and has remanded the matter to the executing court with the direction to dispose of the application filed by the Union of India under section 226(4) of the Act and the objectio....

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....alization, shall be rateably distributed among all such persons : Provided as follows : (omitted)." Under section 73, Civil Procedure Code, the money lying in the executing court continues to belong to the judgment-debtor till it is disbursed among the decree-holders or other creditors of the judgment-debtor. On August 31, 1973, the date on which the application under section 226(4) of the Act was filed by respondent No. 1, cheques sent by the Civil Judge, Agra, to the executing court were lying with the executing court. The payment was actually made to the appellant on April 23, 1974, i.e., after the passing of the order dated March 4, 1974, rejecting the application under section 226(4) filed by respondent No. 1. The High Court w....