T R RAJAKUMARI Vs. TAX RECOVERY OFFICER

JUDGEMENT

(1.) THIS writ petition is for certiorari to quash the proceedings in T.R.C. No. 1 of 1974, on the file of the Tax Recovery Commissioner, Madras-I, Madras, dated February 11, 1975.

(2.) THE short facts are as follows : THE petitioner is an assessee on the file of the ITO, Circle V(2), Madras. In respect of taxes stated to be due from a firm carrying on business under the name "R. R. Pictures", recovery proceedings were taken against her under Section 226(3) of the I.T. Act (hereinafter referred to as "the Act"). By a notice dated March 6, 1973, the ITO (Administration and Collection), Central Circle XI, intimated that a sum of Rs, 12,05,208 is due from M/s. R. R. Pictures on account of taxes. She was called upon to pay forthwith any amount which is due from her to the said R. R. Pictures. No money was due from the petitioner to the said R. R. Pictures. THErefore, under the bona fide belief that there was no need to reply, she remained silent. On November 13, 1973, the ITO, Central Circle XIII, Madras, sent a letter to the petitioner stating that since no reply had been sent by her to the notice dated March 6, 1973, she was directed to send a copy of the account of R. R. Pictures as found in her books enclosing the latest transaction as on date. THE letter further called upon her to show cause why she should not be treated as an "assessee in default", under Section 226(3)(x) of the Act, in respect of the amounts specified therein, and why further proceedings may not be taken against her for the realisation of the amount due by her to the said "R. R. Pictures". Pursuant to this notice, the petitioner caused to be produced before the ITO, the books of Rajakumari THEatre which is her proprietary concern, on January 22, 1974. It was explained that no money was due by her to the said R. R. Pictures. On May 4, 1974, the ITO, Central Circle XIII, Madras, sent a letter to the petitioner intimating that the stand taken by her is untenable and, therefore, she would be treated as a defaulter under the provisions of Section 226(3)(x) of the Act. It was further stated that coercive steps would be taken against her for the recovery of the taxes due from R. R. Pictures, as if the arrears were due from the petitioner to the extent of Rs. 4,42,348. On August 22, 1974, a warrant of attachment was issued to her under Rule 48 of the 2nd Sch. to the Act, by the TRO, V, Madras, prohibiting her from charging or transferring the land and building bearing Door No. 134, Habibullah Road, T. Nagar, Madras, which is the residential house of the petitioner. Similarly, another warrant of attachment was served on her prohibiting her from charging or transferring Rajakumari THEatre belonging to her. THE warrant of attachment was also served on her attaching the movable in her house. On receipt of the attachment warrants, the petitioner filed an appeal under Rule 86(1)(a) of the 2nd Sch. to the Act, to the Tax Recovery Commissioner stating that the entire proceedings were without jurisdiction and the attachments had to be raised. On this appeal, the TRC found that there was no dispute of the statement of fact that the claim of R. R. Pictures with reference to the sum of Rs. 4,42,348 from the petitioner had become time barred. Nevertheless, he held that the issuance of tax recovery certificate under Section 226 was proper and hence the attachments were valid. This is by an order dated February 11, 1975. Thus, the writ petition.

(3.) THE petitioner never availed of the opportunities given to her by the ITO and did not produce her personal account books to prove her case.