9911796707
TMI Blog1968 (8) TMI 40X X X X Extracts X X X X X X X X Extracts X X X X ..... ed - - - - - Dated:- 6-8-1968 - Judge(s) : VEERASWAMI., RAMAPRASADA RAO. JUDGMENT The judgment of the court was delivered by VEERASWAMI J.-The appellant in the appeals is the Union of India, represented by the Second Income-tax Officer, Tirunelveli. The Uthamalai Zamin was notified and taken over with effect from January 3, 1951, under the provisions of the Madras Act XXVI of 1948. The S ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... both in respect of income-tax arrears and of penalty. A reading of the provisions of section 50 in the light of section 44(1) of the Act would lead to the legal position that creditors are excluded from making claims against interim payments. This view receives support from Lakshminarayana v. Lakshmi Venkayamma and Jaya Shri Devi Rajkumari of Vizianagaram v. Lalita Kumari Devi. It follows, there ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ity though it becomes payable after it is quantified in accordance with ascertainable data, and there is a perfect debt at any rate on the last day of the accounting year and not a contingent liability. That concludes the point in favour of the Union except for 1951-52. The Tribunal should, therefore, consider the Union's claim out of the last installment of final compensation on that basis. So ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , at least on the last day of the accounting year. There remains the question of priority. Here again, the Union is supported by authority : Builders Supply Corporation v. Union of India. In that case, the Supreme Court held that the Government of India is entitled to claim priority for arrears of income-tax due to it from a citizen over debts from him to unsecured creditors. That common law pri ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s any specific opinion in respect of the arrears pertaining to 1947-48. The Tribunal will have to consider this question and decide. S.T.A. No. 5 of 1967 is allowed and O.P. No. 42 of 1965 is directed to be disposed of afresh by the Tribunal in the light of the observations contained in this judgment and according to law. There will be no order as to costs in either of the appeals. - - TaxTMI ..... X X X X Extracts X X X X X X X X Extracts X X X X
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