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TMI Blog1968 (8) TMI 16X X X X Extracts X X X X X X X X Extracts X X X X ..... ust 10, 1965, that Kapurchand Shrimal, manager of the family, be detained in civil prison for fifteen days. The manager then moved a petition in the High Court of Andhra Pradesh against the order of detention. The petition was rejected by a single judge of the High Court holding that the manager had, in contravention of rule 16(2) of Schedule II of the Income-tax Act, 1961, dealt with the properties of the family after receiving notice of the issue of the tax recovery certificate. In appeal against that order, the manager applied for leave to raise the contention that where a Hindu undivided family had committed default in payment of the tax, its karta not being the assessee against whom the certificate is issued, is not liable to be detained for recovery of tax due by the Hindu undivided family. The High Court declined to allow the contention to be raised and held that the manager having acted in contravention of rule 16(2) of Schedule II of the Income-tax Act, 1961, the ingredients of rule 73 were attracted and he was liable to be detained in civil prison. A day before this order was passed the appellant filed another petition under article 226 of the Constitution challenging the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the modes mentioned below, in accordance with the rules laid down in the Second Schedule-- (a) attachment and sale of the assessee's movable property ; (b) attachment and sale of the 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 and immovable properties." By rule 1(b) of Schedule II of the Income-tax Act, 1961, " defaulter " means the assessee mentioned in the certificate. Rule 2 provides that when a certificate has been received by the Tax Recovery Officer from the Income-tax Officer for recovery of arrears under Schedule II, the Tax Recovery Officer shall cause to be served upon the defaulter a notice requiring the defaulter to pay the amount specified in the certificate within fifteen days from the date of service of the notice and intimating that in default steps would be taken to realise the amount under the Schedule. Rule 16 provides that where a notice has been served on a defaulter under rule 2, the defaulter shall not be competent to mortgage, charge, lease or otherwise deal with any property belonging to him except with the permission of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... -(i) an individual, (ii) a Hindu undivided family, (iii) a company, (iv) a firm, (v) an association of persons or a body of individuals, whether incorporated or not, (vi) a local authority, and (vii) every artificial juridical person, not falling within any of the preceding sub-clauses. The legislature having treated a Hindu undivided family as a taxable entity distinct from the individual members, constituting it, and proceedings for assessment and recovery of tax having been taken against the Hindu undivided family, it was not open to the Tax Recovery Officer to initiate proceedings against the manager of the Hindu undivided family for his arrest and detention. It is true that if properties of the family, movable and immovable, are to be attached, proceedings may be started against the Hindu undivided family and the manager represents the family in proceedings before the Tax Recovery Officer. But by the clearest implication of the statute the assessee alone may be deemed to be in default for non-payment of tax, and liability to arrest and detention on failure to pay the tax due is also incurred by the assessee alone. The manager, by virtue of his status, is competent to represent ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er is assessed to tax. Nor is there any provision enabling the Income-tax Officer or the Tax Recovery Officer to treat the manager of the Hindu undivided family as an assessee in default under the provisions of the Act. Section 160 provides for treating a person as a representative assessee, and section 161 prescribes the liability of a representative assessee. Section 179 makes a special provision for rendering the directors of a private company in liquidation to be jointly and severally liable for the payment of tax which cannot be recovered from the assets of the private company in liquidation. The legislature has made no such provision for recovery of tax by resort to the personal property of the manager of the Hindu undivided family, or by his arrest and detention for default by the family in paying the tax due. Sections 276, 276A, 277 and 278 on which reliance was placed by counsel for the revenue in support of his argument also do not assist him. These sections occur in a chapter relating to penalties, and they seek to penalise failure to carry out specific provisions mentioned therein. We are unable to hold that the expression " person " in sections 276, 276A and 277 is ..... X X X X Extracts X X X X X X X X Extracts X X X X
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