RYAN PLAST Vs. INCOME TAX OFFICER

JUDGEMENT

(1.) THE petitioner is a registered partnership firm engaged in the business of manufacture of all types of adhesive tapes. (1) of the IT Act, 1961 ('the Act' for convenience). The said order is passed by the 1st respondent against Mr. K.K. Mistry, partner of M/s Simplex Enterprises ('assessee' for short) as it was seen that during the pendency of the assessment proceedings under the Act or after completion of such proceedings but before the service of notice in Form ITCP -1 under r. 2 of the Second Schedule by the TRO, the assessee had created a charge on, or parted with the possession by way of sale, mortgage, gift, exchange or some other mode of transfer of certain properties either owned by the assessee or owned by the firm of M/s Simplex Enterprises in which the assessee is a partner. In view of this any transaction entered into by the assessee in respect of the properties quoted in the order was declared to be void. Consequently, the property purchased by the petitioner from M/s Simplex Enterprises has been declared to be void. The petitioner is therefore, aggrieved by the said order. Hence this writ petition.

(2.) WE have heard learned counsel appearing for the petitioner at some length. Heavy reliance is placed by learned counsel on the judgment of the Supreme Court in TRO vs. Gangadhar Vishwanath Ranade (Dead) Through Mrs. Sobha Ravindra Nemiwant (1998) 149 CTR (SC) 90 : (1998) 6 SCC 658 and the judgment of this Court in Ms. Ruchi Mehta & Ors. vs. Union of India & Ors. (2008) 214 CTR (Bom) 107. Learned counsel contended that if the Department desires to have the transaction of transfer declared void under s. 281, the Department being in the position of a creditor will have to file a suit for a declaration that the transaction of transfer is void under s. 281 of the IT Act.

(3.) IN view of this settled position of law, learned counsel for respondent Nos.1 to 3 makes a statement that respondent Nos. 1 to 3 will file a suit in the appropriate Court within a period of 12 weeks from today. This statement is accepted in view of the statement made by learned counsel for respondent Nos. 1 to 3, we direct that the attachment shall continue to operate for a period of 16 weeks from today so as to enable respondent Nos. 1 to 3 to obtain appropriate orders from the appropriate Court. We make it clear that we have not examined the merits of the case. The petition is disposed of in the aforestated terms.