Modes of tax recovery. - Income Tax - 1670/CBDT

INSTRUCTION NO. 1670/CBDT Dated: May 12, 1985 When an assessee is in default or deemed to be in default in making payment of tax, the Income-tax Officer forwards to the Tax Recovery Officer a Tax Recovery Certificate and the TRO on receipt of such certificate shall proceed to recover from such assessee the amount specified therein by one or more of the following modes in accordance with the rules laid down in the IInd Schedule:- (a) Attachment and sale of assessee's movable property. (b) Attachment and sale of assessee's immovable property. (c) Arrest of the assessee and his detention in prison. (d) Appointing a receiver for the management of the assessee's movable or immovable properties. 2. It is thus imperative that all efforts should be made to recover the outstanding demand by exercising the powers given in the Income-tax Act. The question of writing off the arrear demands would normally arise only when the amount remains irrecoverable inspite of the exercise of the powers given under the Act. Recently, while considering the write off proposal in a case the Finance Minister minuted as under :- 1. When evasion was detected in books why was not prosecution launched? Who were the officers then concerned with the case? 2. If attachment was not yielding result recourse to civil prison should be resorted to. 3. Unless the recourse of civil prison is also exhausted we should not normally write off". It is, therefore, impressed on all Commissioners of Income-tax and Commissioners of Income-tax(Recovery) that recourse to committing the defaulter to civil prisons should be persued vigorously wherever possible to the extent permissible under the law. Unless this mode of recovery is also exhausted, it is not morally correct to term the outstanding demand as irrecoverable. The action taken in this regard may be brought out specifically in the minutes of Zonal Committee which considers the proposal for write off. If for any reason this mode of recovery could not be reasorted to in any particular case, the reason therefor may also be recorded in the said minutes. These instructions may be brought to the notice of all officers working under your charge.