SARDAR GURMUKH SINGH Vs. TAX RECOVERY OFFICER

JUDGEMENT

(1.) THIS petition under Article 226 of the Constitution of India arises out of the recovery proceedings which were taken by the TRO to realise certain income-tax dues payable by the petitioner.

(2.) THE facts, in brief, are these : M/s. Atma Singh Steel Rolling Mills, 94/4 Factory Area, Kanpur, was a partnership firm and was being assessed as such under the I.T. Act. THE petitioner happened to be one of the two partners of the said firm. His elder brother, Sardar Saran Singh, was the other partner. THE ITO issued recovery certificates to the TRO, Kanpur, and the details of such certificates are set out in para. 5 of the petition. However, the opposite parties in the counter-affidavits have not accepted the correctness of the details given in the said para. In para. 4 of the counter affidavit of Sri V.K. Arora, the TRO-B, Kanpur, it has been stated that the correct figure of the total demand against the firm was Rs. 4,82,280 and against the two partners of the said firm the respective figures were Rs. 6,55,077 and Rs. 4,03,720. Thus the total demand against the partnership firm and its partners is said to exceed Rs. 15,00,000. It is not necessary to decide the said controversy in the instant case. It seems that, when the recovery proceedings were taken by the TRO, the petitioner approached the Commissioner, U.P., Kanpur, with a prayer that he desired to enter into a compromise with the I.T. Dept. for paying the tax dues. A true copy of the said application has been annexed with the petition and marked as annex. II. It may be stated that this application was made by the petitioner and his brother, Sardar Saran Singh, who was the other partner in the aforesaid firm. A true copy of the reply of the ITO dated October 9, 1974, is annex. III to the petition. THE ITO referred to the aforesaid application made by the petitioner and his brother and intimated that the Commissioner had been pleased to allow the instalment of Rs. 8,000 per month, subject to certain conditions set out in the said communication. THEreafter, the petitioner and his brother wrote back to the ITO the letter dated October 14, 1974, a true copy whereof is annex. IV to the petition. THE two brothers expressed their agreement, "to all the terms and conditions mentioned by your honour, vide your letter under reply". THEreafter, the ITO, vide his letter dated November 19, 1974, addressed to the said firm and its two partners stated that the addressees were being allowed to pay the arrears of tax due from the firm and its partners in instalments of Rs. 8,000 per month "subject to the following terms and conditions". In Clauses (a) to (e) of para. 2 of the said communication the terms and conditions were set out. In para. 3 of the said communication it was stated "as for removing the lock and seal on your main gate and godown, necessary instructions are being issued to the Tax Recovery Officer-B, Kanpur," and in para. 4 it was stated "you will please immediately inform this office the date from which your factory starts functioning."

(3.) FROM the averments made in para. 8 of the counter-affidavit of Shri V.K. Arora, it is clear to us that no efforts were being made by the petitioner and his brother to act in the spirit in which the facility of instalment of Rs. 8,000 per month for the payment of tax dues was granted to the petitioner and his brother. They were not presenting themselves before the TRO, and, dates after dates were being fixed for their appearance. It is obvious that the petitioner and his brother were not keen to start the mills and they thought that they were amply protected inasmuch as it was laid down in annex. V to the petition that in the month when the mill did not run, instalments will be kept pending. In our view, it was not the intention that they should be allowed to take advantage of their own laches. Shri Katju pointed out that, now, more than six years had passed and nothing had been paid by the petitioner and his brother towards the tax dues payable by them. In this view of the matter, it is not necessary to consider Shri Katju's other contentions, including the one which he has based on [1956] 29 ITR 792 (Punj) (CIT v. Lala Rajeshwar Parshad) for contending that the facility of instalment which was granted by annex. V to the petition, addressed to the petitioner and his brother and the partnership firm in question, was administrative in nature and as such was not amenable to the certiorari jurisdiction of this court. In our view, the petitioner was himself in default in complying with the terms and conditions laid down in annex. V to the petition and as such is not entitled to the relief claimed in the petition. This petition, accordingly, fails and is dismissed, but in the circumstances of the case, there will be no order as to cost.