TaxTMI 
TaxTMI 
1973 (2) TMI 3
X X X X Extracts X X X X
X X X X Extracts X X X X
.... to pay. the same in four instalments of Rs. 13,274.31 each payable on December 9, 1952, February 9, 1953, April 9. 1953, and June 9, 1953, and, accordingly, the first instalment was recovered from him with penalty. Notice to pay the second and third instalments by April 21, 1953, was served on him but this amount was not paid. Instead, the appellant filed a writ petition in the Allahabad High Court and obtained a stay order which was subsequently vacated. Thereafter, the State sought to recover the amount but the appellant filed a revision challenging the proceedings for recovery on the ground that they had become time-barred under section 32(2) of the Act. The Board accepted the contention and held that no proceedings could be commenced f....
X X X X Extracts X X X X
X X X X Extracts X X X X
....menced after the expiration of one year from the date on which the last instalment fixed under section 30 falls due or after the expiration of one year from the date on which any appeal relating to such sum has been disposed of. " Before we deal with the main contention, it may be stated that once a notice of demand is served on the assessee for payment of tax due under the Act, and the assessee makes a default after the date for payment specified therein has expired, a debt is created in favour of the State. This debt the State can recover by any of the modes open to it under the general law. This is also the position under the Indian Income-tax Act, but it is contended that the analogous provisions of sub-section (7) of section 46 of th....
X X X X Extracts X X X X
X X X X Extracts X X X X
....n is taken to recover the whole or any part of the sum within the period hereinbefore referred to, and for the removal of doubts it is hereby declared that the several modes of recovery specified in this section are neither mutually exclusive, nor affect in any way any other law for the time being in force relating to the recovery of debts due to Government, and it shall be lawful for the Income-tax Officer, if for any special reasons to be recorded he so thinks fit, to have recourse to any such mode of recovery notwithstanding that the tax due is being recovered from an assessee by any other mode. It is manifest that this Explanation does not in any way confer a right on the revenue to recover arrears of tax by any mode other than those ....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... well-established that once a debt is created, the State has the right to recover it by any of the modes open to it under the general law, unless as a matter of policy only a specific mode to the exclusion of any other is prescribed by the law. No such prohibition is enacted in section 32 of the Act. Even prior to the amendment of sub-section (7) of section 46 of the 1922 Act, several High Courts in this country had taken this view. In Manickam Chettiar v. Income-tax Officer, Madura, a Full Bench of the Madras High Court was dealing with the right of the Crown to obtain payment of arrears of tax due from the assessee's properties sold in execution of a decree where the questions were, firstly, whether, the Government was entitled to claim....