TaxTMI 
TaxTMI 
2017 (12) TMI 1132
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....y acquired by the petitioner by registered sale deed dated 25.03.2008 is sought to be declared null and void. (2) The brief facts, which are culled out from the record of the petition are as under: (3) The petitioner acquired property being 4, Golden Tulip Bungalows (Town Planning Scheme No.21/Final Plot No.198A), Shreyas Foundation, Ellis Bridge, Ahmedabad vide registered sale deed dated 25.03.2008 for a consideration of Rs. 1,15,00,000/. It was acquired from Shri Harishbhai F. Shah, Shri Bharatbhai F. Shah and Dairy Den Limited and the sale deed is duly registered with the SubRegistrar, Ahmedabad (4Paldi). The petitioner purchased the property after verifying the title thereof and that no encumbrances were recorded in the SubRegistrar&#....
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....vide judgment and order dated 02.02.2017 quashed and set aside the order dated 28.09.2015 thereby upholding the sale transaction. Pursuant to the said order, vide letter dated 26.05.2017, the respondent released the attachment over the property. (6) Thereafter, by the impugned order dated 26.05.2017 the respondent declared the sale in favour of the petitioner as null and void for the alleged outstanding tax demand of Rs. 1,74,05,860/against Shri Harishbhai F. Shah arising out of penalty order dated 17.03.2006. (7) A notice dated 04.09.2017 came to be served upon Shri Harishbhai F. Shah, wherein the property is sought to be auctioned on 11.09.2017, which was communicated to the petitioner by Shri Harishbhai F. Shah on 05.09.2017. The petit....
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....pecial Civil Application No.17280 of 2017. (10) Per contra, Mr.M.R.Bhatt, learned Senior Counsel appearing on behalf of the respondentTax Recovery Officer has submitted that pursuant to the judgment dated 02.02.2017, the property in question was released vide office order dated 26.05.2017 and a fresh Form No.57 was issued to the assessee on 23.05.2017 for the penalty demand (with interest) of Rs. 1,74,05,869/since this Court in the said judgment had left open for the revenue to initiate appropriate proceedings to recover the amount due and payable under penalty order dated 17.03.2006 from the very property. He has further contended that as per section 281 of the Act 'certain transfers are void' and the transfer in question will fal....
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....esent case. Reliance is also placed upon the decision in the case of Tax Recovery Officer Vs. Industrial Finance Corporation of India, 2011 LawSuit (Guj) 651. In view the aforesaid, he has urged that the present petition deserves to be dismissed. (11) Heard the learned counsel appearing on behalf of respective parties at length and perused the record of the case. (12) The core issue which falls for consideration is whether the Tax Recovery Officer has jurisdiction to declare the transaction of transfer of property as null and void under section 281 in the proceedings under rule 16 of the Second Schedule to the Act. (13) The facts established from record are that, the earlier order dated 28.09.2015 of declaring the sale as void was quashe....
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....ny other person, such charge or transfer shall be void as against any claim in respect of any tax or any other sum payable by the assessee as a result of the completion of the said proceeding or otherwise: Provided that such charge or transfer shall not be void if it is made (i) for adequate consideration and without notice of the pendency of such proceeding or, as the case may be, without notice of such tax or other sum payable by the assessee ; or (ii) with the previous permission of the [Assessing] Officer. (2) This section applies to cases where the amount of tax or other sum payable or likely to be payable exceeds five thousand rupees and the assets charged or transferred exceed ten thousand rupees in value. Explanation.....
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.... the property in question was attached and the transaction of transfer of the property was declared as null and void by the Tax Recovery Officer by resorting to proceedings under rule 16 of the Second Schedule to the Act. In our considered opinion, the issue involved in the present case is squarely covered by the decision of the Supreme Court in the case of Gangadhar Vishwanath Ranade (supra) and the decision of this Court in the case of Karsanbhai Gandabhai Patel (supra), wherein after examining the provisions of section 281 which provides certain transfers to be void and rule 11 of the Second Schedule, it is held that the Tax Recovery Officer has no power to declare transfer as void and the status of the Department being a creditor, will ....