9911796707
TMI Blog1999 (7) TMI 59X X X X Extracts X X X X X X X X Extracts X X X X ..... the Income-tax Act, 1961 ("the Act"), vide order dated April 5, 1999. The petitioners contend that the impugned orders of attachment under section 281B of the Act are unlawful, unconstitutional, ultra vires, without authority of law, passed without due application of mind and are patently bad in law, misconceived and vitiated. It is prayed that these orders be set aside and quashed. We have heard learned counsel for the parties. Rule returnable after eight weeks. Respondents waive service. Heard Mr. F. B. Andhyrajina, learned counsel for the petitioners, on the prayer for interim relief. Also heard Mr. R. V. Desai, learned counsel for the respondents. Mr. Desai was also heard on earlier occasion when the petitioners prayed for ad interim ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he actual market value of over Rs. 6 crores, only to justify attachment of bank accounts and F.D.Rs. It was further contended that the attachment in this case under section 281B was illegal and without jurisdiction because the conditions precedent did not exist. It was stated that value of the immovable properties shown in the affidavit was ridiculously low. Learned counsel furnished a report of valuation of the two immovable properties attached by the Revenue made by Chawla Architects and Consultants Pvt. Ltd., who are approved valuers on June 17, 1999, As per the valuation report, the valuation of room No. 106, Mehta House, is Rs. 1.60 crores and flat No. 6 in Fionika is Rs. 4.23 crores. According to learned counsel, even if attachment un ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tain instructions. Today, when the matter was called out, Mr. Desai informed us that he has been instructed by the joint Commissioner of Income-tax concerned, that since the valuation of immovable properties were bound to fluctuate, the Department would prefer to have the provisional attachment under section 281B on the bank deposits and F.D.Rs. and for the shortfall of Rs. 1,70,000 that remains thereunder between the amounts under attachment and the anticipated liability estimated at Rs. 2.68 crores, accept any other security offered by the assessee and release the two immovable properties from attachment. The joint Commissioner has advised learned counsel to make this suggestion to the court and to submit to the orders of the court. We ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e pendency of any proceedings or assessment or reassessment of any income, even though there is no demand outstanding against the assessee, if he is of the opinion that it is necessary to do so to protect the interests of the Revenue. To ensure that this power is not misused, a number of safeguards have been provided in the section itself. It is not necessary for us, at this stage, to examine the same. One thing is clear that this power should be exercised by the Assessing Officer only if there is a reasonable apprehension that the assessee may thwart the ultimate collection of the demand that is likely to be raised on completion of the assessment. The power of attachment under this section is in the nature of attachment before judgment und ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssessing Officer were worth Rs. 5.83 crores as per the valuation of the approved valuer as against the estimated tax liability of Rs. 2.68 crores. That being so, there was no justification for attaching the bank accounts and the F.D.Rs. of the assessee which has very seriously affected the day-to-day business of the assessee. The Revenue wanted time to get the two immovable properties valued themselves. They were allowed to do so. They have got them valued by the Department Valuer. The value, as per the Departmental Valuer, is Rs. 2.66 crores. Obviously, the two immovable properties attached by the Assessing Officer which. on their own valuation are worth Rs. 2.66 crores are sufficient to ensure the full recovery of the estimated liability ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... were confident that having found that valuation of the immovable properties attached by him was Rs. 2,66,30,000, as against the estimated liability of Rs. 2,68,30,000, the Assessing Officer, on his own, would release the bank accounts and F.D.Rs. from attachment. We are sorry that he has not done so. On the other hand, he wants to retain attachment on the bank accounts and F.D.Rs. and release the immovable properties from attachment. We have given our careful consideration to the facts and circumstances of the case. The two properties of the assessee, which have been attached under section 281B of the Income-tax Act, having been valued even by the Departmental Valuer at Rs. 2.66 crores against the anticipated liability of Rs. 2.68 crores, ..... X X X X Extracts X X X X X X X X Extracts X X X X
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