2012 (7) TMI 737 - HC - Income Tax

Recovery of the tax dues of the petitioner s wife - attachment of flat co-owned - Held that - Petitioner s application to vacate the attachment of the flat was rejected as the Tax Recovery Officer confirmed the liability of the petitioner s wife in respect of the said tax dues and held that she was a co-owner of the said flat - no concrete evidence brought on record by the petitioner to prove that he was the sole owner thereof - thus that the attachment of the flat would remain in force till the date of payment of the arrears - no inclination to exercise extra-ordinary jurisdiction under Article 226 of the Constitution of India - against assessee.

Summary

Issues:
Recovery of tax dues from a partner of a firm, attachment of property, challenge to orders of attachment, legal ownership of a property in question, jurisdiction under Article 226 of the Constitution of India, availability of alternate remedy through appeal.

Analysis:
The judgment by the Bombay High Court, delivered by Justice S.J. Vazifdar, pertains to a challenge against orders dated 25th August, 2009, and 29th December, 2011, regarding the recovery of tax dues of a petitioner's wife, a partner in a firm. The respondents claimed outstanding arrears of approximately Rs.7,19,25,317 and proceeded against the partners' properties, including a residential flat co-owned by the petitioner's wife. Initially, the petitioner's wife requested to lift the attachment and offered to pay her share of the tax liability. Subsequently, the petitioner objected to the attachment, arguing his wife had no legal right in the flat despite being listed as a co-owner.

The Tax Recovery Officer confirmed the wife's liability for the tax dues, stating she was a co-owner of the flat with no concrete evidence provided by the petitioner to prove sole ownership. The court refrained from making observations on the merits, emphasizing the need for evidence examination and possibly oral testimony. Declining to intervene under Article 226 of the Constitution of India, the court highlighted the availability of an alternate remedy through an appeal before the Commissioner/Chief Commissioner of Income-tax.

Consequently, the Writ Petition was dismissed, allowing the attachment to continue. However, if the petitioner files an appeal and seeks interim relief within four weeks, no further action for the sale of the flat will be taken until the interim application is decided and, if unfavorable, for an additional four weeks. The judgment concluded without any order as to costs, keeping all contentions open for further proceedings.