9911796707
|
Home
Issues:
1. Validity of the notice dated January 5, 1996, for sale of properties due to income tax arrears. 2. Applicability of rule 68B of the Second Schedule to the Income-tax Act, 1961. 3. Service of notice on the legal representative of the deceased defaulter. Issue 1: Validity of the notice for sale of properties: The petitioner challenged the notice dated January 5, 1996, seeking to restrain the respondents from proceeding with the sale of properties due to income tax arrears. The petitioner argued that her father, the income-tax assessee, had made payments towards the arrears before his death, and the property was attached by the Tax Recovery Officer. The petitioner contended that the sale proceedings were initiated beyond the permissible period under rule 68B of the Second Schedule to the Income-tax Act, 1961. However, the court held that the notice issued on January 5, 1996, fell within the statutory period provided by rule 68B(1) of the Act, thereby dismissing the challenge against the validity of the notice. Issue 2: Applicability of rule 68B of the Second Schedule: The court analyzed the provisions of rule 68B of the Second Schedule to the Income-tax Act, particularly sub-rules (1) and (3). It was noted that the rule specifies a limitation period of three years from the end of the financial year in which the order giving rise to the tax demand became conclusive. The court interpreted that sub-rule (3) fixes June 1, 1992, as the conclusive date for demands made and properties attached before that date. This interpretation led to the conclusion that the sale notice issued on January 5, 1996, was within the prescribed period as per rule 68B(1), thereby upholding the applicability of the rule in the case. Issue 3: Service of notice on the legal representative: The petitioner raised concerns about not being served with a notice after her father's death, claiming a violation of natural justice. However, the court referred to rule 85 of the Second Schedule to the Income-tax Act, which allows the Tax Recovery Officer to continue proceedings against legal representatives as if they were the defaulters. The court found that the petitioner was indeed served with a notice demanding payment of tax arrears, thereby ruling out any violation of natural justice. Consequently, the court dismissed the challenge on this ground as well. In conclusion, the High Court of Madras, through Judge N. V. Balasubramanian, dismissed the writ petition challenging the notice for sale of properties due to income tax arrears. The court upheld the validity of the notice issued on January 5, 1996, within the statutory period as per rule 68B of the Second Schedule to the Income-tax Act, 1961. Additionally, the court found no violation of natural justice in the service of notice on the legal representative of the deceased defaulter. The petitioner was granted six months to clear the tax arrears, failing which the Department could proceed with the sale of the property.
|
