1969 (6) TMI 10 - HC - Income Tax

Certificates were issued under s. 222 of the New Act for the recovery of the amounts due - Power/competency of TRO - recovery proceeding commenced by one TRO named in the certificate could, be continued by another TRO of the same area - new certificate under s. 222 of the new Act with respect to such recovery is scarcely necessary

Issues:
1. Competence of Tax Recovery Officer to commence recovery proceedings under section 222 of the Income-tax Act, 1961.
2. Validity of notices of demand issued under the old Act and their impact on recovery proceedings under the new Act.
3. Requirement of notices under section 156 of the new Act for certificates issued under section 222.
4. Authority of the Tax Recovery Officer to make recovery based on certificates issued under section 222.
5. Appointment and authority of Tax Recovery Officers under section 2(44) of the new Act.
6. Plea of limitation in specific writ petitions.

Analysis:
1. The petitioners challenged the competence of the Tax Recovery Officer to initiate recovery proceedings under section 222 of the Income-tax Act, 1961, without prior notices of demand under section 156 of the new Act. The argument was based on the timing of certificates issued under section 222 and the appointment of the Tax Recovery Officer. However, the court held that the recovery proceedings were valid as default had occurred under the old Act, authorizing recovery under the new Act.

2. The petitioners contended that notices of demand under the old Act were not valid for recovery under the new Act. The court clarified that default under the old Act, due to non-payment specified in notices issued under the old Act, constituted default under the new Act as well. This allowed the Income-tax Officer to forward certificates to the Tax Recovery Officer for recovery.

3. The requirement of notices under section 156 of the new Act for certificates issued under section 222 was raised. The court determined that default under the new Act could be established based on non-compliance with notices issued under the old Act, without necessitating additional notices under the new Act.

4. The authority of the Tax Recovery Officer to proceed with recovery based on certificates issued under section 222 was challenged. The court emphasized that recovery was permissible under the new Act for amounts due under the old Act, as provided in section 297(2)(j), regardless of the timing of notices or appointments of Tax Recovery Officers.

5. The appointment and authority of Tax Recovery Officers under section 2(44) were discussed. The court clarified that multiple Tax Recovery Officers in an area could exercise concurrent powers for recovery under section 222, and a change in the appointed officer did not invalidate the recovery proceedings.

6. The plea of limitation was raised in specific writ petitions. The court examined the dates mentioned in the notices of demand and certificates, finding discrepancies in some cases. However, as the errors were rectified or explained, the plea of limitation was dismissed in those instances, leading to the dismissal of the writ petitions.

In conclusion, the court upheld the validity of the recovery proceedings under section 222 of the Income-tax Act, 1961, based on defaults under the old Act, clarified the interplay between notices under old and new Acts, and affirmed the authority of Tax Recovery Officers for recovery actions. The dismissal of the writ petitions was primarily due to the resolution of issues related to limitation and procedural technicalities.

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