JSR Infra Developers Pvt. Ltd. Vs Tax Recovery Officer (Madras High Court)
Conclusion: Once an appellate authority like the Commissioner (Appeals) or the ITAT deleted a tax addition and assessee’s liability stood discharged, the Tax Recovery Officer was bound to give effect to such order and lift the attachment.
Held: Assessee’s premises were searched and assessments under Section 153A were completed for AYs 2011–12 to 2017–18, with additions for AYs 2015–16 to 2017–18. Assessee’s appeals before CIT(A) were partly allowed, setting aside the additions, which order was confirmed by the ITAT. Despite the ITAT’s confirmation and full payment of the outstanding tax, Department failed to lift the property attachment order, contending that an appeal before the High Court was under process. Assessee contended that once the factual findings attained finality before the ITAT—the highest fact-finding authority—and the entire demand was discharged, the attachment could not subsist. Reliance was placed on Sri Lakshmi Brick Industries v. TRO [(2013) SCC OnLine Mad 378] and Coromandel Oils (P) Ltd. v. TRO [(2017) 10 ITR-OL 56 (Mad)].
Department argued that since an appeal was proposed before the High Court, the ITAT order had not attained finality, and the attachment could continue. It was held that once the factual findings of the ITAT attained finality and assessee’s liability stood discharged, the Tax Recovery Officer was bound to give effect to such order and lift the attachment. The pendency or proposed filing of an appeal on a question of law did not justify continuation of attachment unless assessee was declared in default after fresh demand. The law laid down in Sri Lakshmi Brick Industries and Coromandel Oils (P) Ltd. squarely applied.
