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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 ..... and for the sake of brevity and conciseness, W.P.No.25031 of 2023 is taken as a lead case and it would be suffice to note the facts stated thereunder :- i) The petitioners are involved in the business of wholesale and retail sales of ready-made garments, jewellery, furniture and household articles for the last 6 decades. The petitioners have been duly filing its returns under Income Tax Act, 1961 (hereinafter referred to as 'the Act) as well as indirect taxes (GST). ii) A search was conducted in all the business premises of the petitioners' Company, i.e. at T.Nagar, incomplete construction at Zamin Pallavaram, Coimbatore and its Group Companies at Madurai and Tirunelvali and the residences of the Promoters and Employees from 01.12.2021 to 06.12.2021 and during the course of search, the respondent-Department seized certain loose sheets, electronic devices and cash from the business premises of the petitioner-Company situated at T.Nagar, and drawn separate panchanamas with regard to seizure of materials collected at various locations of the petitioner-Company and its employees and Group Companies. iii) Pursuant thereto, the respondent-Department issued warrants for atta ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... order, whereas, in the present case, the respondent-Department instead of extending the provisional attachment order, rather they have issued fresh orders, for fourth time, that too, without assigning any reasons. Therefore, the learned Senior Counsel contended that the impugned orders, provisionally attaching the petitioners' properties is erroneous in law, as the same has been passed in a routine, mechanical manner, that too for the fourth time, without assigning any reasons. 3.2 Further, the learned Senior Counsel would submit that by way of attachment order, the petitioners' entire properties that were mortgaged with various Banks for the purpose of availing loan have been attached, and in terms of loan agreements entered into between the petitioner and the Bankers, the Bankers are the first charge holders of the properties and for the purpose of serving working capital requirement, they have to top-up/renew the loan agreement, only then, the business will go smoothly and the first charge holders, viz., Bankers can recover the dues as per the loan agreement entered into between them and the petitioners. Therefore, the learned Senior Counsel expressed his grievance that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... revenue and not to destroy the business of the petitioners, as contended by the petitioners and if at all, the petitioner is aggrieved by the attachment order, he shall approach appropriate Authorities, who have power under Section 281(b) for reconsidering the attachment order passed by the respondent. 5. Heard Mr.G.Karthikeyan, learned Senior Counsel for the petitioner and Mr.A.P.Srinivas, learned Senior Standing Counsel for the respondent- Department and also perused the materials available on record. 6. The main ground, on which, the present impugned orders of attachment are assailed is on the aspect of power of the respondent- Department to issue fresh attachment orders again and again without assigning any reasons, since the impugned orders under Section 281 B have been issued in a mechanical manner for the fourth time and in a routine fashion stating that 'For the purpose of protecting the interest of the Revenue, it is necessary to attach the immovable properties of the petitioners''. 7. It is the case of the petitioners that they have been duly filing ITRs under the I.T. Act and indirect tax statutes. However, a surprise inspection was conducted both at the p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... operties, being the Bankers, 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. The petitioners herein, viz., i) M/s.Saravana Selvarathnam Retail Private Limited and ii) M/s.Rathna Akshaya Estates Private Limited, have earned good reputation and credibility amongst the general public, based on which, the Bankers have come forward to extend the loan facility and this is a continuous arrangements entered into between the Bankers and the Petitioner, for the sake of running the business smoothly, and when the Bank, having extended working capital loan facility to the petitioners, certainly, they will monitor the same so as to protect their interest. The question of non-repayment would arise due to deficit in service of working capital loan extended to the petitioner. Therefore, the respondent-Department could have enabled the petitioner to get their working capital loans extended by the Bankers, and thereafter, monitor the petitioner, whether such loan is being utilized by the petitioner for the purpose, for which, such additional loan is extended, and by doing ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in financial crisis and consequently, the petitioner would be not in a position either to continue the business or repay the loan, ultimately, resulting in closure of business and 5000 workers employed in the petitioner-Company would loose their job, which would automatically affect the welfare of the State. Therefore, this Court is of the view that the respondent-Department under the guise of impugned attachment orders, shall not cause any unnecessary hardships to the Bankers in getting back their loans, which were lent by them to the petitioners. 12. Further, Section 281 B(1) of I.T. Act grants power to the Assessing Officer to provisionally attach the property of an assessee during the pendency of any proceedings for assessment or reassessment of any income or for imposition of penalty, and in terms of Sub-section 2 of Section 281 B, every such provisional attachment shall cease to have effect after the expiry of six months, however, the total period shall not exceed 2 years or 60 days after the order of assessment, whichever is later and such power of extension is subject to the condition that the Principal Commissioner should record his reasons in writing for granting such e ..... X X X X Extracts X X X X X X X X Extracts X X X X
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