TaxTMI 
TaxTMI 
2019 (6) TMI 760
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....e nature of certiorari or any other appropriate writ, direction or order and be pleased to : (a) quash and set aside the impugned order at Annexure-'A' to this petition; (b) pending the admission, hearing and final disposal of this petition, to stay implementation and operation of the order at Annexure-'A' to this petition. (c) any other and further relief deemed just and proper be granted in the interest of justice; (d) to provide for the cost of this petition. " 4. The case of the writ-applicant in his own words as pleaded in the writ-application is as under : "1. The petitioner, by way of this petition under Article 226 of the Constitution of India, challenges the order of attachment passed by the Respondent u/s 222 of the Income Tax Act dated 22. 11. 2017 attaching the property of the petitioner - Plot No. 85/1 + 85/2/1, GIDC, Vatva for the failure to pay dues by one M/s Newempire Infrastructure Pvt. Ltd. , the same being an act which is bad, illegal, contrary to law and without jurisdiction. 2. 1 The petitioner is an individual and citizen of India. The petitioner is, therefore, entitled to the Constituti....
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....e bill in the name of Nilesh Popatlal Patel (HUF). 31. 12. 2016 Assessment Order passed in the case of the New Empire Infrastructure Pvt. Ltd. 21. 02. 2017 Notice of Demand served on New Empire Infrastructure Pvt. Ltd. 01. 03. 2017 Sale Deed between New Empire Infrastructure Pvt. Ltd. and Nilesh Popatlal Patel (HUF). 22. 11. 2017 Order of attachment is passed attaching the plot of land. 6. Mr. Soparkar, the learned senior counsel appearing for the writ-applicant, vehemently submitted that the Tax Recovery Officer, Ahmedabad, committed a serious error in passing the order of attachment of immovable property by placing reliance on Rule 48 of the Second Schedule to the Income Tax Act, 1961. According to Mr. Soparkar, Rule 48 provides for attachment of the immovable property of the defaulter. Mr. Soparkar submitted that the immovable property in the case on hand in the form of a plot in the estate of the GIDC is no longer of the defaulter, and in such circumstances, there could not have been any attachment of the same. 7. Mr. Soparkar further submitted that the impugned order u/s 222 is patently bad, illegal, contrary to law and in gross violation of the f....
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....d the attention of this Court to Annexure-B to this petition at page 12. It is a supplementary agreement in Form No. 36 between the GIDC, the defaulting assessee, i. e. the New Empire Infrastructure Private Limited, and the writ-applicant. Mr. Soparkar, thereafter, invited the attention of this Court to the Office Order dated 29th March 2016 passed by the Divisional Manager, GIDC, Ahmedabad. The Office Order reads thus : "OFFICE ORDER A Plot No. 85/1 + 85/2/1, admeasuring 1195. 50 + 105 (Road & C. P. ) sq. mtrs. was allotted to M/s. New Empire Infrastructure Pvt. Ltd. , The Lease Deed was executed on 1. 11. 80. The Licece had applied to the Corporation for transfer the said plot in favour of Shri Patel Nilesh Popatlal, (HUF). Permission for transfer was given by the Divisional Manager, Ahmedabad as per Letter No. GIDC/DM/ABD/ TFR/VTW/364, Dated 5. 3. 2016. The Lessee has paid all dues of the Corporation up to 2015- 16. He has also paid the "Transfer Fee" amounting to Rs. NIL/-. The Supplementary agreement has therefore been executed on 22. 3. 16, between the Corporation/Lessee and Transferee. The plot now therefore stands transferred in the name of M/s. Shri Pa....
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....rtment, then he should file a claim under Rule 11 of the Second Schedule to the Income Tax Act, 1961. Once such a claim is filed, there would be an inquiry by the Tax Recovery Officer and in the said inquiry the writapplicant can make his stance clear by adducing necessary evidence. Mr. Sanghani would submit that whatever may be the developments and whatever may be the transactions, the same have no legal footing, and in such circumstances, the authority concerned committed no error in passing the order of attachment. 15. Mr. Sanghani placed strong reliance on the following averments made in the affidavit-in-reply filed on behalf of the respondent duly affirmed by the Tax Recovery Officer-3, Ahmedabad : "3. I submit that in the instant case, proceedings in the case of M/s. New Empire Infrastructure Private Limited were initiated under Section 143(2) of the Act. A notice under Section 143(2) of the Act was issued on 5. 4. 2016 and thereupon, assessment proceedings proceeded further which culminated into an assessment order under Section 143(3) of the Act on 31. 12. 2016 raising a demand of Rs. 4,79,50,640=00. The said demand was certified for recovery to the Tax Recovery....
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.... risking jurisprudential confusion. The power is supervisory in nature. . . . . . " 17. In such circumstances referred to above, Mr. Sanghani prays that as there is an alternative remedy available to the writapplicant, he should be asked to avail the same and this writapplication may not be entertained. 18. On 8th October 2018, a coordinate bench of this Court passed the following order : "1. Petitioners have purchased individual industrial plots situated at GIDC, Vatva, which was originally alloted to one Newempire Infrastructure Private Limited, a private limited company by the GIDC. The permission for transfer was granted by GIDC on or around 29. 03. 2016 in all the cases. According to the petitioners, they are occupying respective plots since then and have also started their industries by setting up their plants and machineries. The respondent-Tax Recovery Officer of the Income Tax department has passed a common order dated 22. 11. 2017 against the erstwhile owner attaching the properties in exercise of powers under section 222 of the Income Tax Act, 1961 ('the Act' for short). Counsel for the petitioners submitted that the petitioners are bona-fide purch....
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....e a statement in the prescribed form specifying the amount of arrears due from the assessee (such statement being hereafter in this Chapter and in the Second Schedule referred to as "certificate") and shall proceed to recover from such assessee the amount specified in the certificate by one or more of the modes mentioned below, in accordance with the rules 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 proper....
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.... satisfied that, for the reason stated in the claim or objection, such property was not, at the said date, in the possession of the defaulter or of some person in trust for him or in the occupancy of a tenant or other person paying rent to him, or that, 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, the Tax Recovery Officer shall make an order releasing the property, wholly or to such extent as he thinks fit, from attachment or sale. (5) Where the Tax Recovery Officer is satisfied that the property was, at the said date, in the possession of the defaulter as his own property and not on account of any other person, or was in the possession of some other person in trust for him, or in the occupancy of a tenant or other person paying rent to him, the Tax Recovery Officer shall disallow the claim. (6) Where a claim or an objection is preferred, the party against whom an order is made may institute a suit in a civil court to establish the right which he claims....
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....nvestigation into those claims and orders to be made therein are provided in Rule 11 of the Second Schedule to the Act and to the same effect as in Rules 58 to 61 and 63 of Order 21 of the Code of Civil Procedure. The provisions relating to proclamation of sale, the contents of the proclamation, the mode of making the proclamation, the time of sale and adjournments are contained in Rules 52 to 55 and 15 of the Second Schedule corresponding to Rules 64, 66 to 69 of Order 21 of the Code of Civil Procedure. The provisions in Rules 57 to 68 of the Second Schedule relating to deposit by the purchasers, the procedure to be followed in default of payment, the applications to set aside the sale or confirmation of sales are identically worded as in Rules 83 to 94 of Order 21 of the Code of Civil Procedure. Thus, it is seen that the entire provisions relating to attachment and sale of immovable properties of the judgment-debtor found in the Code of Civil Procedure are incorporated in the Second Schedule as the procedure to be followed for attachment and sale of the defaulter's properties for the recovery of the arrears of incometax due from the defaulter. 26. Section 222 of the Income....
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....ution of a certificate, on the ground that such property is not liable to such attachment or sale, the Tax Recovery Officer shall proceed to investigate the claim or objection. The procedure for such investigation and the manner in which the proceedings to be conducted are enumerated under Rule 11 of the said Rules. Therefore, if the petitioner's claim is that the property is not liable for such attachment, then the petitioner has to make a claim before the Tax Recovery Officer, and for such reason, the petitioner could not have approached this Court invoking the jurisdiction under Article 226 of the Constitution of India. Therefore, the Court holds that the petition is not maintainable. However, considering the fact that the Income Tax Act and Rules framed thereunder, especially Rule 11 under the 2nd Schedule, provides for a remedy to the assessee, the petitioner is at liberty to avail such a remedy. 29. In taking the aforesaid view, we are fortified by a decision of the Supreme Court in the case of Isha Beevi and others v. Tax Recovery Officer, Quilon and others, reported in (1975)101 ITR 449 (SC), wherein, in para-5 the following has been observed : "5. We may po....