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TMI Blog2023 (12) TMI 138X X X X Extracts X X X X X X X X Extracts X X X X ..... kers, the petitioner has to first satisfy the Bankers, for availing loan facility and only the Bankers are satisfied they would come forward to lend loan facility to the petitioners. This Court would like to point out that, if it had been the real intention of the the respondent-Department to protect the interest of the revenue, they would acted in a way, as pointed out by this Court in the preceding para, however, the way the respondent-Department has acted, i.e. issuing attachment orders again and again, that too, without assigning any valid reason, in respect of similar properties of the petitioners, would only go to show that the respondent with a view to put a spoke to the petitioner's business activities, has passed such impugned orders, since, by means of the impugned orders of attachments, the properties that were mortgaged with the Bankers were attached, due to which, the Bankers would obviously, deprive themselves from extending the working capital loan to the petitioners and the petitioners, owing to non-extension of working capital loan, would find it difficult to run their business, resulting in financial crisis and consequently, the petitioner would be not in a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nt issued by the respondent dated 16.08.2023. ii)Thereafter, the concerned respondent is directed to consider the modification applications and directed to pass orders to the extent of lifting the provisional attachment orders dated 16.08.2023 to enable the petitioners to avail the working capital facilities as per the business plan/plan of action, etc., submitted to the bank or to the extent of additional working capital facilities as sanctioned by the Banks to the petitioners, as requested from time to time. iii) The petitioners are directed to file an affidavit/undertaking/status report as required by the respondent-Department, so as to ensure that the fund allotted to the petitioners by the Banks are utilized by the petitioners/has been utilized only for the purpose of working capital facilities. - Honourable Mr. Justice Krishnan Ramasamy For the Petitioner (in all W.P's) : Mr.G.Karthikeyan Senior Counsel for Ms.A.Jagadeeswari For the Respondents (in all W.P's) : Mr.A.R.Srinivas Senior Standing Counsel [for R1 R2], Mr.S.Ravikumar Special Government Pleader[for R3] COMMON ORDER The petitioners have filed these Writ Petitions challenging the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ave challenged the attachment order mainly on the aspect of power of the respondent-Department to issue fresh attachment order again and again, i.e. for the fourth time, without assigning any proper reasons. 3.1 The learned Senior Counsel for the petitioners pointed out that in terms of Section 281 B, order of provisional attachment would be in force only for a period of 6 months and it would cease to have effect after the expiry of 6 months from the date of order made under sub-Section (1) of 281(b) and in the event, they intend to extend the same for further period of six months, the same has to be done even before the expiry of 6 months and likewise, they can extend the said order only for a period of 2 years from the date of issue of original attachment order. Therefore, the learned Senior Counsel would contend that if the respondent-Department issued any provisional attachment order, the same would be in force for a period of 6 months, and for the purpose of extension of any provisional attachment order, the Department must provide reasons for such extension and by merely passing fresh attachment order again and again before the expiry of six months granted under Section ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ded that, in case, the attachment is not removed, not only it would affect the petitioner's business, but will also have a cascading effect of 5000 workers loosing their job. 4. Per contra , Mr.A.P.Srinivas, learned Senior Standing Counsel appearing for the respondent-Department by drawing the attention of this Court to the counter affidavit and written submission filed by the respondent raised strong objection with regard to the contention of the learned Senior Counsel for the petitioner by contending that as far as the power of the respondent, Income Tax Department for passing the provisional attachment order under Section 281 B is concerned, they can pass any number of fresh attachment orders in terms of said Section and it is not open to the petitioner to contend that the respondent-Department has no power to pass fresh attachment order and period of 2 years provided under the statue is only for the purpose of extension of the said attachment order, by issuing fresh attachment order and if any attachment order passed under the said Section , the same will be in vogue for 6 months and thereafter, it can continue upto a period of 2 years by virtue of extension. Therefor ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ate''. 8. It is the grievance expressed by the petitioner that, since the respondent-Department has resorted to such draconian measure of provisional attachment of the petitioners' properties, not for the first time, but for the fourth time, due to which, the petitioners' business has almost come to a standstill, since, the properties, which were attached by the respondent- Department were all the properties, which the petitioners have offered as securities to the Banks, and because of such mortgaged properties were came to be attached, the Banks are refusing to part with further working capital loans, at any moment, they would declare the petitioners as Non Performing Assets, if this situation continues, it will jeopardize the entire business of the petitioner and it would also have a cascading effect of 5000 workers loosing their job, resulting in 5000 families landing on streets suffering for food and shelter. Therefore, the petitioner contended that unless and until, the attachments are lifted, the Banks will stop extending their loan facilities, resulting in the petitioners' closing down their business, and even the Income Tax Department will not be as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... her the intention of the respondent-Department is really to protect the interest of the Revenue or Whether to close down the business of the petitioners by resorting to such draconian action? In reply to the said question, learned Senior Standing Counsel for the respondent-Department stated that, respondent-Department has no intention to cause hindrance or obstacles to the petitioner's running their business and the respondent- Department is mainly concerned only about the safeguarding the interest of the Revenue and in matters of revenue, there is no place for consideration of equity. 11. However, this Court would like to point out that, if it had been the real intention of the the respondent-Department to protect the interest of the revenue, they would acted in a way, as pointed out by this Court in the preceding para, however, the way the respondent-Department has acted, i.e. issuing attachment orders again and again, that too, without assigning any valid reason, in respect of similar properties of the petitioners, would only go to show that the respondent with a view to put a spoke to the petitioner's business activities, has passed such impugned orders, since, by ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ders and the same have been passed before quantification of final assessment of tax. Thus, the respondent-Department, while passing such provisional attachment order shall bear in mind the following aspects:- 1) Running Business Activities of an Assessee should not come to stand still by virtue of the provisional attachment. 2) The interest of the Bankers, who are the first charge holders, should not get affected. 3) The welfare of the workers should not be get affected. 14. Thus, for all aforesaid reasons, this Court is inclined to pass the following orders:- i) The petitioners are directed to file a modification application within a period of one week from the date of receipt of a copy of this order to modify the order of provisional attachment issued by the respondent dated 16.08.2023. ii)Thereafter, the concerned respondent is directed to consider the modification applications and directed to pass orders to the extent of lifting the provisional attachment orders dated 16.08.2023 to enable the petitioners to avail the working capital facilities as per the business plan/plan of action, etc., submitted to the bank or to the extent of additional working capital ..... X X X X Extracts X X X X X X X X Extracts X X X X
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