TaxTMI 
TaxTMI 
2018 (4) TMI 780
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....MOTI DUNGRI, ALWAR No.2550 Date:-29.09.2009 Sh. Ashok Mathur, Dy General Manger (Documentation) Rajsthan State Industrial Development and Investment Corporation Limited, Udyog Bhawan, Tilak Marg, Jaipur. Sir, Subject:- Arrear demand in the case of M/s Panasia Industries Ltd Plot No.F-62-63, RIICO Industrial Area, Behror, Distt. Alwar-regarding. Please refer to your letter No.U(20)3(-62)/164/94 dated 02.07.2009 and this office letter No.TRO- 2/ALW/2009-10/04 dated 23.06.2009 on the above subject. In this connection you have been reminded many times by this office that a huge demand of Rs. 1, 25, 45, 598 is outstanding against the above named assessee and for this purpose attachment of factory building including plant and machinery of M/s Pan Asia Industries Ltd. were made by way of issue of ITCP-16 on 26.03. 2004 by this office. You have been asked many times to cooperate in the matter so that recovery of tax dues may be made from the assessee. But instead of cooperating with the department you are trying to transfer the property of the above named assessee to M/s Premier Texto Trade Pvt. Ltd. You have been aske....
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...., 22, MOTI DUNGRI, ALWAR No. ITO/TRO-2/2010-11/2070 Date:09.06.2010 M/S Premier Texo Trade Pvt. Ltd. F-62-63, Ricco Industrial area, Behror. Sir, Subject: Recovery of outstanding demand of Rs. 7485523/- for Asstt. Year 91-92 to 94-95 in the case of M/S Pan Asia Industries Pvt. Ltd., Behror- regarding. Above demand is outstanding against the above company since long. To recover the above demand the immovable property situated at plot No.62-63, Ricco Industrial area, Behror has been attached by this office on 26.03.2004. Now it has been informed that your Company has taken possession over the immovable properties including the above said plot and possession over the immovable properties including the above said plot and running therein business activities. Since the above said immovable properties already stand attached by this Office you are an assessee in default in respect of above outstanding demand of Rs. 7485523/- plus interest. Accordingly you are requested to deposit the above demand within 3 days of the receipt of this letter failing which the above said immovable property shall be taken in possession by the Department and coerciv....
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....e made only within three years from the end of financial year and as per Rule 68B (4) 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 the limitation specified under this rule. Thus, it is his submission that as the immovable property which was purchased by the petitioner-Company from Pan Asia (the defaulting Company) was made on 17.11.2006 and the sale of the immovable property by the respondent i.e. the Tax Recovery Officer was not made as prescribed under 68B within three years from the end of the financial year in which the order giving rise to the demand of tax for the recovery of which the immovable property has been attached; the attachment order would be deemed to have been vacated on the expiry of three years in other words after the expiry of three years i.e. from 31.03.2004 upto 31.3.2007, the attachment stood vacated on 31.03.2007 and the sale deed executed in favour of petitioner would remain intact and cannot be termed as void after 31.03.2007. (10) Learned Counsel also points out that the Pan ....
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....to RIICO on 13.03.2008 and the RIICO had informed to the Income Tax Authorities that the Corporation had already released its charge over the fixed assets of the Company after the one time settlement arrived at between the defaulting Company and the RIICO. The Income Tax Officer was also informed by the RIICO about the one time settlement between the defaulting Company of the Corporation. The RIICO had also been been asked not to grant and recognize any sale of the property or transfer of title unless No Objection is received from the Office. Learned Counsel submits that in terms of Section 281 of the Act of 1961 any transfer of property where there is any pendency of any proceedings under this act, would be void as against any claim in respect of any tax or any other sum applied by the assesee. Further it is submitted that as per Rule 68(B)(i) the limitation of three years would be only from the date the demand of any tax has become conclusive under the provisions of Section 245(I) or as the case may be final in terms of provisions of Chapter 40 and, therefore, the same would not apply. Learned Counsel further submits that in terms of Section 64 of the CPC a private transfer....
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....es laid down in the Second Schedule-] (a) attachment and sale of the assessee's movable property ; (b) attachment and sale of the assessee's immovable property ; (c) arrest of the assessee and his detention in prison; (d) appointing a receiver for the management of the assessee's movable and immovable properties. [Explanation.-For the purposes of this sub-section, the assessee's movable or immovable property shall include any property which has been transferred, directly or indirectly on or after the 1st day of June, 1973, by the assessee to his spouse or minor child or son's wife or son's minor child, otherwise than for adequate consideration, and which is held by, or stands in the name of, any of the persons aforesaid; and so far as the movable or immovable property so transferred to his minor child or his son's minor child is concerned, it shall, even after the date of attainment of majority by such minor child or son's minor child, as the case may be, continue to be included in the assessee's movable or immovable property for recovering any arrears due from the assessee in respect of any period prior to such date.] [(2) The ....
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.... extended by one year. (2) In computing the period of limitation under sub-rule (1), the period- (i) during which the levy of the aforesaid tax, interest, fine, penalty or any other sum is stayed by an order or injunction of any court; or (ii) during which the proceedings of attachment or sale of the immovable property are stayed by an order or injunction of any court; or (iii) 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, shall be excluded : Provided that where immediately after the exclusion of the aforesaid period, 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. (3) --------------- (4) 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. "70. Where immovable property is at....
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.... 6. But Mr Chagla appearing on behalf of Pillai raised an alternative contention. He said that at the time of sale there was another outstanding attachment and the sale in favour of Padmavathi being contrary to such attachment was, in any event, void. It appears that on January 17, 1956, Pillai had in execution of a decree obtained in Suit No. 55 of 1953, attached the property, but that attachment was removed on March 23, 1957, on satisfaction of the decree. By Section 64, Code of Civil Procedure, the attachment is only void as against all claims enforceable under the attachment, and it is not void generally. Since the attachment effected on January 17, 1956 was removed, any private alienation contrary to such attachment cannot be regarded as void for there are no claims enforceable under the attachment, dated January 17, 1956." (11) In case of Balkrishan Gupta cited (supra) the Apex Court held as under : - "30.---------------What is forbidden under section 64 of the Code of Civil Procedure is a private transfer by the judgment-debtor of the property attached contrary to the attachment, that is, contrary to the claims of the decree holder under the decree for realisatio....
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....ment and unless in the operation of the same any conflict arises this aspect need not be examined. In this case no such conflict arises between the corporation and the Excise Department. Hence it is unnecessary to examine this aspect of the matter." (15) A look at the aforenoted provisions show that under Section 68B if the sale is not executed within a period of three years after the attachment, the same shall be deemed to have been vacated. However, Rule 48 mentions attachment of immovable property of a defaulter prohibiting the defaulter from transferring or charging the property in any way and prohibiting all persons from taking all benefits under such transfer or charge fees. Thus, if the facts of the present case are taken into consideration, it is apparent that Section 281 of the Act of 1961 would not come into operation to declare the sale and transfer as void since the provision is only with reference to the pendency of the proceedings before the service of notice under Rule 2 of Second Schedule. (16) Learned Counsel for the petitioner relying upon Rule 16(2) has submitted that since it was a private transfer or delivery of a property attached, the same could be void....