V.c.senthilkumar v. The Commissioner Of Income Tax-Ii,Income Tax Office,Coimbatore

IN THE HIGH COURT OF JUDICATURE AT MADRAS DATED: 28-04-2011 THE HONOURABLE MR.JUSTICE M.JAICHANDRENW.P.No.29538 of 2010 and M.P.No.1 of 2010 V.C.Senthilkumar .. Petitioner. Versus 1. The Commissioner of Income Tax-II,Income Tax Office,Coimbatore. 2. The Tax Recovery Officer,Income Tax Office,No.279-B, Gandhi Road,Erode-638 001. 3. M.Loganathan .. Respondents. PRAYER: Petition filed under Article 226 of the Constitution ofIndia praying for a Writ of Certiorarified Mandamus calling for therecords related to the impugned orders passed by the 1[st] and 2[nd]respondents respectively in TRC-86(1)/01/CIT-II/CBE/10-11, dated22.9.2010 and T.R.C.No.5/01-02 & 9/02-03/TRO-1/ERD, dated 22.1.2010and quash the same, consequently, direct the respondents 1 and 2 toraise the attachment against 3[rd] respondent property which issituated in Survey No.111/B, Ward No.14, Bharathidasan Street,Veerappan Chathiram, Erode and thereby enable the 2[nd] respondent toexecute sale deed in favour of the petitioner. For Petitioner: Mr.R.Marudhachalamurthy For Respondents: Mr.J.Nayanasamy (R1 & R2) The petitioner has stated that he is an agreement holder ofan agreement for sale, in respect of the property, in SurveyNo.111/B, situated at Bharathidasan Street, Veerappan Chathiram,Erode, belonging to the third respondent. It has been further statedthat the petitioner had entered into an agreement for sale with thethird respondent, in respect of the property in question, afterhaving found from the office of the Sub Registrar concerned that https://hcservices.ecourts.gov.in/hcservices/ there was no encumbrance in respect of the said property. Thepetitioner had entered into an agreement with the third respondentand his son, on 2.5.2007, having paid an advance of Rs.5,00,000/-.Thereafter, the petitioner had paid a further sum of Rs.10,00,000/-to the third respondent, as part of the sale consideration. Whileso, the petitioner had come to know that the property in question,belonging to the third respondent, had been attached by the incometax department, due to the non payment of tax arrears by the thirdrespondent. The request made by the petitioner to release theproperty in question from attachment had been rejected by the orderof the second respondent, dated 22.1.2010. In such circumstances,the petitioner has preferred the present writ petition before thisCourt, under Article 226 of the Constitution of India. 2. The learned counsel appearing on behalf of the petitionerhad submitted that the impugned order of the second respondent,dated 22.1.2010, is arbitrary and void. The second respondent hadpassed the impugned order, without considering the fact that thepetitioner had entered into an agreement for sale, with the thirdrespondent, in respect of the property in question, only afterproper verification of the encumbrance, created in respect of thesaid property. The agreement had been entered into only after it wasfound that there was no encumbrance, in respect of the saidproperty. 3. It had also been stated that the petitioner had paid thefull consideration to the third respondent for the purchase of theproperty in question in the year 2007 itself, as per the saleagreement, dated 2.5.2007. Thereafter, the petitioner has been incontinuous possession and enjoyment of the property in question,till date. While so, the Tax Recovery Officer, Range-I, Erode, hadissued an order of attachment of the property in question, due tothe non payment of the tax arrears, by the third respondent, to thetune of Rs.1,76,00,957/-, even though the third respondent is owninga number of other immovable properties, including a shoppingcomplex, worth several crores of rupees. The petitioner should notsuffer due to the non payment of the tax arrears by the thirdrespondent. 4. The learned counsel for the petitioner had also submittedthat no notice had been issued to the petitioner and no opportunityhad been given to him even though he is a bona fide agreementholder, in respect of the property in question. In suchcircumstances, the impugned order of the second respondent is liableto be set aside. 5. The learned counsel appearing on behalf of the petitionerhad relied on the following decisions in support of his contentions: 1) Tax Recovery Officer Vs. Gangadha Viswanath Ranade (1998Vol.234 ITR 188). 4) Jagdish Sharma V. UOI [2008(217) CTC (Raj.) 472] 5) Samson John V. TRO [(2008) 169 Taxman 227/6300 188 6. The learned counsel appearing on behalf of the first andthe second respondents had submitted that the petitioner has nolocus standi to maintain the present writ petition. A notice hadbeen issued to the third respondent, under Rule 2 of the SecondSchedule of the Income Tax Act, 1961, dated 6.11.2001, directing himto pay the tax arrears of Rs.1,76,00,957/-. As the third respondenthad failed to discharge his liability his property, in S.No.111/B,had been attached, by an order, dated 15.11.2007, issued under Rule48 of the Second Schedule to the Income Tax Act, 1961, and it hadbeen served on the third respondent, on 16.11.2007. 7. He had also submitted that as per Rule 51 of the Income Tax Rules1962, the attachment of an immovable property would relate back tothe date on which the notice to pay back the arrears had been servedon the defaulter. Thereafter, an alienation of the property inquestion by the defaulter, would be void, as per Rule 16 of theIncome Tax Rules,1962. In such circumstances, it is not open to thepetitioner to claim that the attachment of the property of the thirdrespondent is illegal and void. When the third respondent had notagitated the matter, in the manner known to law, it is not open tothe petitioner to approach this Court by filing a writ petition,under Article 226 of the Constitution of India. Therefore, the writpetition filed by the petitioner is devoid of merits and therefore,it is liable to be dismissed, in limine. 8. In view of the averments made in the affidavit filedsupport of the writ petition and in view of the submissions made bythe learned counsels appearing on behalf of the parties concernedand on a perusal of the records available and on considering thedecisions cited by the learned counsel for the petitioner, thisCourt is of the considered view that the petitioner does not havethe locus standi to maintain the present writ petition. The https://hcservices.ecourts.gov.in/hcservices/ attachment of the property in question by the concerned authoritiesof the Income Tax Department, which had been made in accordance withthe procedures established by law, cannot be questioned by thepetitioner, who is said to be an agreement holder, in respect of theproperty in question. 9. The agreement for sale, said to have been entered into bythe petitioner with the third respondent, cannot bind therespondents 1 and 2, as they are not parties to the said agreement.Further, the petitioner has not been in a position to show that thethird respondent had agitated the matter, before the appropriateforum or authority, in accordance with the relevant provisions oflaw. The petitioner cannot be said to be an aggrieved party, at thisstage. However, it goes without saying that it would be open to thepetitioner to agitate the matter against the third respondent,before the appropriate forum, in the manner known to law. As such,it is clear that the writ petition is devoid of merits. Hence, it isdismissed. No costs. Consequently, connected miscellaneous petitionis closed. Sd/- Asst.Registrar. /true copy/ Sub Asst.Registrar.cshTo 1. The Commissioner of Income Tax-II,Income Tax Office,Coimbatore. 2. The Tax Recovery Officer,Income Tax Office,No.279-B, Gandhi Road,Erode-638 001. MS (CO)kk 10/6