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| The Tax Publishers2020 TaxPub(DT) 1571 (SC) : (2020) 424 ITR 0018 : (2020) 313 CTR 0601 : (2020) 272 TAXMAN 0001 INCOME TAX ACT, 1961
Section 222
Where charge over property in question was created much prior to issuance of the recovery notice under rule 2 of Schedule II to Income Tax Act by Tax Recovery Officer, said charge in property remained valid, even though sale of property was conducted after issuance of attachment order.
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Recovery - Attachment of property - Sale of property pursuant to order passed by DRT - Charge over property in question was created much prior to issuance of the recovery notice
Assessee filed petition in High Court seeking a restraint order against Tax Recovery Officer for enforcing attachment made under the IT Act, 1961 for recovery of the dues. High Court dismissed petition holding that rule 16(2) was applicable on ground that actual sale took place after order of attachment was passed. Assessee appealed to Supreme Court. Held: The High Court failed to take into account the fact that sale of the property was pursuant to order passed by DRT (Debts Recovery Tribunal) with regard to property over which a charge was already created prior to issuance of notice for attachment. As charge over the property was created much prior to the issuance of notice under rule 2 of Schedule II to the Act, there was force in submissions made on behalf of assessee. Judgment of the High Court was set aside and appeal was allowed.
REFERRED :
FAVOUR : In assessee's favour.
A.Y. :
IN THE SUPREME COURT OF INDIA
L. NAGESWARA RAO & DEEPAK GUPTA, JJ.
Connectwell Industries (P) Ltd. v. UOI
Civil Appeal No. 1919 of 2010
6 March, 2020
Petitioner by: Farid F. Karachiwala
Respondent by: Navdeep Vora
L. Nageswara Rao, J.
1. The Appellant filed the Writ Petition in the High Court of Judicature at Bombay seeking a restraint order against the Tax Recovery Officer, Range 1, Kalyan-Respondent No. 4 for enforcing the attachment made under the Income Tax Act, 1961 (hereinafter referred to as 'the Act') for recovery of the dues. The Writ Petition was dismissed by the High court, aggrieved by which the Appeal has been filed.
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