N MANGATHAYARAMMA Vs. TAX RECOVERY OFFICER

JUDGEMENT

(1.) The main question that arises for decision in these writ petitions is whether the house property bearing municipal door No. 28/49 situated as Subhash Road, Old Town, Anantapur, hereinafter referred to as the "petition schedule property", is liable to be sold for recovery of wealth-tax arrears for the assessment years 1982-83 to 1988-89 due from the late Nimmalla Appanna. It is stated that N. Appanna and his father, the late N. Peddanna, were wealth-tax assessees and were residents of Anantapur town.

(2.) It appears that there were wealth-tax arrears to the tune of Rs. 5.5 lakhs owed by N. Appanna in respect of the assessment years 1982-83 to 1988-89. According to the wealth-tax authorities, the above house properties with appurtenant lands belonged to the joint family and were assessed in the hands of N. Appanna, Hindu undivided family (HUF). In connection with the recovery of the said arrears of the wealth-tax, the Tax Recovery Officer, Income-tax Department, issued a proclamation in the Tetitgu daily newspaper Eenadu and brought to sale the petition schedule property and ultimately auction was conducted on 12/01/1996, and the sale was knocked down in favour of the petitioner in W. P. No. 9227 of 1996, he being the highest bidder, for a consideration of Rs. 6,58,000. As, per the auction conditions, the purchaser deposited a sum of Rs. 1,65,000 being 1/4th of the total value of the bid and the balance of the bid amount of Rs. 5 lakhs was also subsequently paid by the purchaser to the Tax Recovery Officer vide bank draft No. 301196, dated 24/01/1996, drawn on the Andhra Bank, Tirupati, and the Tax Recovery Officer issued receipt dated 25/01/1996, in favour of the purchaser for having received the entire sale consideration. However, the sale deed was not executed in favour of the purchaser. In the said background, the purchaser, viz., Sri Y. Madhusudhana Reddy filed W. P. No. 9227 of 1996 praying for a writ in the nature of mandamus directing the Tax Recovery Officer to issue sale certificate and also execute the sale deed in his favour in respect of the petition schedule property. W. P. No. 9227 of 1996 was filed in this court on 23/04/1996.

(3.) Even before W. P. No. 9227 of 1996, was filed by the purchaser, W. P. No. 109 of 1996 was filed by N. Mangathayaramma, wife of the late Bhujangarayudu and her five children on 8/01/1996, praying for a direction to the Tax Recovery Officer and the concerned Inspectors of Income-tax not to auction the petition schedule property as well as other house properties bearing municipal door Nos. 28/50, 28/51 and 28/52 situated at Subhash Road, Old Town, Anantapur, and to declare the impugned action of auctioning the above properties as illegal. In the said writ petition, the petitioners claimed that the properties mentioned in the, auction notification dated 7/01/1996, and published in Eenadu daily are the properties of petitioners Nos. 2 to 6 and they are not the properties of the late N. Appanna and therefore those properties are not liable to be attached and sold for recovery of wealth-tax arrears due from N. Appanna. According to N. Mangathayaramma and her children, the above properties were acquired by them through a registered will deed dated 5/07/1969, executed by the late Peddanna, who is the father of N. Appanna. They claimed that the house properties were the self-acquired properties of the late Peddanna and therefore N. Appanna did not have any title or right or interest in those properties and the title to those properties passed on to the children of N. Mangathayaramma and her late husband Bhu-jangarayudu. They also claimed that subsequent to the execution of the registered will, the late Peddanna executed a registered codicil in the year 1974 apportioning all his properties among Bhujangarayudu and his children.