1989 (7) TMI 54

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....ed under article 226 of the Constitution challenges the notice issued under section 226(3) of the Income-tax Act by the Inspecting Assistant Commissioner of Income-tax, D-Range, Kanpur, calling upon the National Textile Corporation Limited, Kanpur, to pay a sum of Rs. 5,00,000 alleged to be due to the Department towards the income-tax dues from Swadeshi Cloth Dealers Limited, Kanpur. The case o....

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....ur opinion, the demand made by the Income-tax Officer towards the income-tax dues payable by the firm, Swadeshi Cloth Dealers Limited, Kanpur, could not be recovered from the National Textile Corporation Limited, the petitioner. From the facts stated, it appears that during the course of business, Swadeshi Cotton Mills Company Limited, entered into an agreement of sole selling agency with Swadeshi....

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....er of Income-tax for the recovery of the amount due from Swadeshi Cloth Dealers Limited. It was this notice which was challenged in the present writ petition on the ground that, under the Acquisition Act, the liability of Swadeshi Cloth Dealers Limited stands suspended and, as such, no money could be demanded from the petitioner towards the income-tax dues. The further claim was that the Inspectin....