Case Law Details
Kaneria Granito Ltd Vs ACIT (Gujarat High Court)
In this case, admittedly, all the three bank accounts were in the nature of either the cash credit account or term loan account. In other words, the accounts were opened to enable the assessee to borrow the money from the bank for the purpose of its business. Any money, therefore, that the bank may make available to the assessee would necessarily be in the nature of a loan or a cash credit facility, in either case, would be in the nature of borrowing by the assessee from the bank. The bank and the assessee, therefore, do not have the debtor-creditor relationship.
Division Bench of Bombay High Court in case of M/s. Sargam Foods Pvt. Ltd. vs. State of Maharastra in the judgement dated 08.07.2010 also considered the similar issue and set aside the attachment of the petitioner’s cash credit account for recovery of the unpaid taxes.
Such being the consistent view of various High Courts of the country, we have no hesitation in adopting similar line, also looking to the phraseology used in the statutory provisions contained in sub section (3) of Section 226.
FULL TEXT OF THE JUDGMENT/ORDER of GUJARAT HIGH COURT
Please become a Premium member. If you are already a Premium member, login here to access the full content.
