S K AGARWAL Vs. TAX RECOVERY OFFICER

JUDGEMENT

(1.) BY these petitions under Article 226 of the Constitution, the two petitioners seek to challenge the validity of certain recovery proceedings initiated at the instance of the ITO, " A " Ward, Ferozabad.

(2.) IT appears that on 6th May, 1972, a settlement was arrived at between the petitioners and the revenue authorities according to which the petitioners had undertaken to discharge the income-tax liabilities of the firm, Madan Mohan Dhamma Mal and its five partners, Ferozabad Glass and Chemical Industries Ltd., M/s. Kumar Pharmaceutical Works Private Ltd., and Madan Mohan Dhamma Mal Trust Society. The petitioners came to this court with the allegation that the ITO, " A " Ward, Ferozabad, forwarded recovery certificates in respect of the dues of the aforementioned parties to the TRO. The TRO issued a notice to the petitioners-requiring them to show cause why they should not be committed to civil prison, in execution of the recovery certificates issued by the ITO. The notice was served on the petitioners on 2nd March, 1976, and they were asked to appear before the TRO on 5th March, 1976. The petitioners appeared before the TRO and they were informed that the TRO had gone out of station. The petitioners then filed applications asking for another date to enable them to file their objections. Accordingly, the matter was adjourned to 27th March, 1976. On 27th March, 1976, the petitioners' accountant attended the office of the TRO and filed objections claiming that the recovery was illegal as credit of the taxes already paid had not been given either in the case of the firm or its partners. He was then informed that a warrant for the petitioners' arrest had already been issued on 26th March, 1976. The petitioners, therefore, rushed to this court and filed the present writ petitions impugning the recovery proceedings on a number of grounds.

(3.) A perusal of the various rules contained in the Second Schedule mentioned above shows that once the defaulter has, in pursuance of the notice under Rule 73, appeared before the TRO, no order for committing him to civil prison can be made under Rule 76 unless the proceedings under Rule 74 are over. In this case, the fact that the petitioner had, in pursuance of the notice issued under Rule 73(1), appeared before the TRO on 5th March, 1976, and again on the adjourned date, i.e., on 27th March, 1976, has not been denied. As admittedly the petitioners had put in appearance before the TRO on the date mentioned in the show-cause notice, prima facie there was no occasion for the TRO to issue a warrant for the petitioner's arrest on 26th March 1976, in exercise of the powers conferred by Sub-rules (2) and (3) of Rule 73.