MANICKAM CHETTIAR Vs. INCOME-TAX OFFICER

JUDGEMENT

(1.) The petitioner obtained a money decree against one Govinda Rao and in execution thereof attached certain movable properties belonging to the judgment-debtor and brought them to sale. Govinda Rao under an order of assessment dated the 28 August, 1934, was required to pay a sum of Rs. 301-13-0 by way of income-tax. He did not comply with the notice of demand for payment and on the 12 November, 1934, a penalty of Rs. 10 was imposed by the Income-tax Officer because of the default, thus increasing the total amount due by the assessee to Rs. 311-13-0. Before the sale the Income-tax Officer filed an application in Court asking for an order directing the payment out to him from the sale proceeds when the sale took place of the amount due to Government by Govinda Rao. The sale in execution was in due course carried out, but only realised on Rs. 227-9-0. After reserving the amount required for the costs of execution the District Munsiff ordered the balance to be paid out to the Income-tax Officer. The question which we are called upon to decide is whether the Court had power to order the payment out of moneys due to Government on mere application.

(2.) I had occasion to consider this question in the case of Soniram Rameshur V/s. Mary Pinto (1933) I.L.R. 11 Rang. 467 when sitting as a judge of the Rangoon High Court, and, following the decision of Sale, J., in Bala Dassee V/s. Butto Kristo Bairagee (1906) I.L.R. 33 Cal. 1040 held that inasmuch as the Crown has priority over unsecured creditors in the payment of debts the Court can, on application and without a formal attachment being issued, order the payment of a Crown debt due by the debtor where there are funds in Court belonging to the debtor. The District Munsiff referred to this decision in his order. The order which I passed in that case was passed by consent, and the only arguments were those addressed to the Court on behalf of the Crown, but the question has been fully argued before us to-day and I see no reason for changing the opinion there expressed.

(3.) It has been suggested that inasmuch as Section 46 of the Indian Income-tax Act provides modes for the recovery of arrears of income-tax the Crown is not entitled to adopt any different method. Sub-section (2) states that the Income-tax Officer may forward to the Collector a certificate under his signature specifying the amount of arrears due from an assessee, and the Collector, on receipt of such certificate, shall proceed to recover from the assessee the amount specified as if it were an arrear of land revenue. Without prejudice to any powers of the Collector in this behalf he shall for the purpose of recovering the amount have in respect of the attachment and sale of debts due to the assessee the powers which, under the Civil Procedure Code, a Civil Court has in respect of attachment and sale of debts due to a judgment-debtor for the purpose of the recovery of an amount due under a decree. By Sub-section (3) it is provided that in any area in respect of which the Commissioner has directed that any arrears may be recovered by any process enforceable for the recovery of an arrear of any Municipal tax or local rate imposed under any enactment for the time being in force in any part of the province, the Income-tax Officer may proceed to recover the amount due by such process. Under Sub-section (5) if any assessee is in receipt of income chargeable under the head "salaries" the Income-tax Officer may require the employer to deduct from his salary what is due by way of income-tax. This section, however, does not profess to be exhaustive and it cannot without express words to that effect take away from the Crown the right of enforcing payment by any other method open to it. Therefore I do not regard Section 46 as imposing a bar to an application of the nature of the one we are now concerned with.