Mr.kishore Chataram Nanwani v. The Income Tax Officer, Ward – I (1), Pondicherry

IN THE HIGH COURT OF JUDICATURE AT MADRAS THE HON'BLE MR. JUSTICE K.RAVICHANDRABAABU Mr.Kishore Chataram Nanwani ... Petitioner vs. 1. Office of the Tax Recovery Officer, Income Tax Department, D.P.Thottam, Muthaialpet, Pondicherry 605 003. 2. The Income Tax Officer, Ward – I (1), Pondicherry. 3. The Commissioner of Income Tax (Appeals), D.P.Thottam, Muthaialpet, Pondicherry 605 003 ... Respondents Writ Petition filed under Article 226 of the Constitutionof India praying to issue a Writ of Certiorari to call for therecords of the first respondent in TRC No.424 & 512/TRO/17-18dated 27.02.2018 and quash the same. For Respondents : Mr.A.P.Srinivas Standing Counsel The petitioner is aggrieved against the proceedings of thefirst respondent dated 27.02.2018, in issuing the proclamationof sale of the property shown in the schedule to theproceedings, for the recovery of the sum of Rs.1,04,79,418/-from the petitioner. 2. The case of the petitioner, in short, is as follows:Orders of assessment for the assessment years 2008-09 and https://hcservices.ecourts.gov.in/hcservices/ 2009-10 were passed on 30.12.2010 and 30.12.2011, fixing thetotal tax liability payable by the petitioner as Rs.19,41,402/-and Rs.36,66,921/- respectively. The petitioner went on appealbefore the Commissioner of Income Tax (Appeals). The AppellateAuthority, by order dated 28.03.2014, partly allowed the appealsand computed an unaccounted income in respect of assessment year2008-09 as Rs.21,12,002/- and in respect of assessment year2009-10 as Rs.18,61,505/-. Giving effect orders were passed on20.05.2014 and 21.05.2014, demanding a sum of Rs.10,32,908/-+Rs.8,17,887/-+Rs.38,72,006/-. Aggrieved against the said orderof the Appellate Authority, the Revenue went on appeal beforethe Income Tax Appellate Tribunal and those appeals weredismissed on 17.03.2015. Further, Tax Case Appeals filed beforethis Court by the Revenue in Tax Case Appeal No.211/2016 ispending. While so, the present impugned proceedings was issuedbased on the original order passed by the Assessing Authoritywithout realising the fact that the said order has been modifiedby the Appellate Authority as stated supra. 3. The respondents filed counter affidavit wherein it isstated that subsequently an order imposing penalty on thepetitioner was also passed and therefore, the amount claimed inthe impugned proceedings is appropriate. 4. The learned counsel for the petitioner, afterreiterating the contentions raised by the petitioner in theaffidavit filed in support of the petition, invited this Court'sattention to the impugned proceedings to contend that the samecannot be sustained, since it was passed based on the order ofthe Assessing Authority while the same got modified already bythe Appellate Authority. Therefore, he contended that the basisfor issuing proclamation for sale itself is factually erroneous. 5. On the other hand, Mr.A.P.Srinivas, learned StandingCounsel for the respondents contended that as the petitioner isliable to pay penalty also, the amount referred to in theproclamation of sale is not erroneous. However, he fairlyadmitted to the position that the impugned proclamation of salewas issued based on the order passed by the Assessing Authority,even though, in the mean time, the said order was modified bythe first Appellate Authority, namely the Commissioner of IncomeTax (Appeals). 6. Perusal of the impugned proclamation of sale would showthat the amount sought to be recovered from the petitioner,namely Rs.1,04,79,418/- was based on the certificates issued on30.01.2012 and 22.03.2012, in pursuant to the order passed bythe Assessing Authority. Admittedly, this proclamation of salewas issued on 27.02.2018, by which time much water has flown inthe subject matter, as the appeal filed by the petitioner before https://hcservices.ecourts.gov.in/hcservices/ 6. Perusal of the impugned proclamation of sale would showthat the amount sought to be recovered from the petitioner,namely Rs.1,04,79,418/- was based on the certificates issued on30.01.2012 and 22.03.2012, in pursuant to the order passed bythe Assessing Authority. Admittedly, this proclamation of salewas issued on 27.02.2018, by which time much water has flown inthe subject matter, as the appeal filed by the petitioner before https://hcservices.ecourts.gov.in/hcservices/ the Commissioner of Income Tax (Appeals) was allowed in partthereby, modifying the order of the Assessing Authority asstated supra. 7. It is further seen that the Revenue has gone on appealbefore the Tribunal against the order of the Appellate Authorityand such appeal was dismissed. It is true that further appealfiled by the Revenue before this Court is pending. However, thefact remains that the order passed by the Assessing Authorityhaving been modified by the first Appellate Authority, anyfurther proceedings to recover the amount from the petitioner inthe meantime, has to be drawn based on the order passed by thefirst Appellate Authority and not based on the order passed bythe Assessing Authority. Therefore, I find that passing of theimpugned proceedings, based on the order passed by theAssessing Authority, cannot be sustained. However, it is open tothe Revenue to issue fresh certificate based on the order passedby the first Appellate Authority as well as any other assessmentorder and arrears if any, passed in respect of the very sameyear and proceed further accordingly, however, without prejudiceto the contentions raised in the appeal pending before thisCourt. 8. Accordingly, this writ petition is allowed and theimpugned proceedings is set aside by granting liberty to therespondents to proceed to recover the amount due from thepetitioner based on the order passed by the first AppellateAuthority, namely Commissioner of Income Tax (Appeals) and anyother assessment order passed in respect of the very sameassessment year by issuing appropriate proceedings against thepetitioner. No costs. Consequently, connected miscellaneouspetitions are closed. Sd/- Assistant Registrar(CO) //True Copy// Sub Assistant Registrar sni/vsi To 1. Office of the Tax Recovery Officer, Income Tax Department, D.P.Thottam, Muthaialpet, Pondicherry 605 003. https://hcservices.ecourts.gov.in/hcservices/ 2. The Income Tax Officer, Ward – I (1), Pondicherry. Ward – I (1), Pondicherry. 3. The Commissioner of Income Tax (Appeals), D.P.Thottam, Muthaialpet, Pondicherry 605 003 D.P.Thottam, Muthaialpet, Pondicherry 605 003 +1 cc to Mr.M.Jayaprakash, Advocate Sr.No.77218 +1 cc to Mr.A.P.Srinivas, Advocate Sr.No.77152 W.P.No.6321 of 2018NMI(CO)CSL/28.11.2018