B INDIRA RANI Vs. COMMISSIONER OF INCOME TAX

JUDGEMENT

(1.) The petitioner is the daughter of one R. Bharathan. Both of them were in arrear of huge amounts by way of tax to the Income Tax Department. Immovable properties belonging to the petitioner were attached for recovery of the amounts due from the petitioner. She paid off the entire arrears and filed the application Ext. P6 before the Commissioner of Income tax, Thiruvananthapuram requesting that the attachment of her properties may be lifted. But the Commissioner sent reply Ext. P7 dated March 30, 1992 declining the request and informing the petitioner that the attachment cannot be lifted. The petitioner has thereupon filed this writ petition for the issue of a writ of mandamus to the respondents, viz. the Commissioner of Income tax, and the Tax Recovery Officer, to declare/proclaim that the attachment of her immovable properties stands withdrawn, and for other incidental reliefs.

(2.) In the counter affidavit filed on behalf of the respondents, it is admitted that the arrears due from the petitioner have been completely paid; but it is stated that her father Bharathan owes an amount of Rs. 14,26,382.30 to the department, for which the petitioner is stated to be "vicariously" liable under R.26 of the Second Schedule to the Income Tax Act, 1961 (for short the Act). The case of the respondents is that this amount had been paid by Bharathan to the Kerala State Beverages corporation Limited, for the purchase of foreign liquor in the business of the petitioner, and that the petitioner has not repaid the amount to him. Garnishee proceedings were initiated and the notices Exts. R2(b) dated 25-7-1991 and R2(c) dated 31-7-1991 were issued under R.26 of the Second Schedule to the Act, mentioning the above facts and prohibiting the petitioner from making payment of any amount to Bharathan, and Bharathan from recovering the debt due from the petitioner. There was also a direction to the petitioner to pay the amount of the debt to the Tax Recovery Officer. The petitioner did not respond to these notices, or file any statement on oath so that the Tax Recovery officer wrote to the petitioner by Ext. R2(d) dated 15-11-1991 informing her that since she did not respond to the notices Exts. R2(b) and R2(c), she will be deemed to be in default of payment of the amount specified in the letter Ext. R2(b), and that, further proceedings will be taken against her for, realisation of the amount as if it were an arrear of tax due from her.

(3.) Counsel for the petitioner submits that since the attachment was for the arrears of tax due from her, it stood automatically withdrawn as soon as the entire amount due from her was paid. No further act, formally withdrawing the attachment, was necessary, as if stood withdrawn on payment of the arrears. If any further amounts were due from her as alleged, as a person owing debts to Bharathan, respondents have to take fresh proceedings for attachment of her properties for recovery of those amounts. No such proceedings have been initiated and therefore, and having regard to the terms of R.12 of the Second Schedule to the Act, the petitioner is entitled to the declaration that the attachment stands withdrawn.