Case Law Details
M.K. Rajendran Pillai Vs ACIT (Madras High Court)
Introduction: In the recent legal battle of M.K. Rajendran Pillai against the Assistant Commissioner of Income Tax (ACIT), the Madras High Court has delivered a significant verdict. The petitioner sought relief through a writ of mandamus, urging the court to lift the attachment on his immovable properties. This article delves into the case background, arguments, and the court’s decisive order, unraveling the legal intricacies.
Detailed Analysis: The petitioner, represented by learned counsel, contended that the Income Tax Appellate Tribunal, in its order dated 20.01.2023, had set aside the assessment orders and additions for the years 2012-13 to 2018-19. Consequently, the matter was remanded to the assessing authority for fresh assessment orders. Post the remand, the assessing authority nullified the earlier additions, leading to a substantial refund of Rs.10,77,61,574/- for the said assessment years.
Challenging the attachment order on his properties, the petitioner argued that with no remaining tax liability, the continued attachment lacked justification. The respondents countered, citing the provisional nature of the attachment, valid for six months from the order date, extendable up to two years or sixty days from the assessment order date. According to the respondents, the last attachment on 30.12.2019 had expired, rendering the attachment void ab initio.
Accepting the respondents’ stance, the court disposed of the writ petition, emphasizing that no attachment exists on the petitioner’s properties. The respondents’ statement clarified the automatic termination of the attachment, allowing the petitioner unrestricted control over his properties.
Conclusion: The M.K. Rajendran Pillai Vs ACIT case highlights the pivotal role of legal remedies in tax-related disputes. The court’s decision to lift the property attachment post the annulment of assessment orders showcases the importance of due process and fairness in tax matters. As the petitioner regains control over his properties, this legal triumph sets a precedent for cases involving similar circumstances, ensuring justice and relief for the affected taxpayers.
FULL TEXT OF THE JUDGMENT/ORDER OF MADRAS HIGH COURT
Heard Sri.R.V Easwar assisted by Sri.Sidharth A Menon, Sri. Muhammed Aljuq and Ms.Ananya Rath, learned counsel appearing for the petitioner and Ms. Susie B Vargheshe, learned Senior Standing Counsel appearing for the Income Tax Department.
2. The present writ petition has been filed praying for writ of mandamus commanding the respondents to lift attachment on the immovable properties belonging to the petitioner as the Income Tax Appellate Tribunal had in its order dated 20.01.2023 in respect of the assessment years 2012-13 to 2018-19 had set aside the assessment orders and additions and remanded the matter back to the assessing authority to pass fresh assessment orders in the light of the observations made by the Income Tax Appellate Tribunal in its order dated 01.2023. The order of attachment was passed after the assessment orders had originally finalised by the assessing authority which have been now set aside. On remand the assessing authority has deleted the additions earlier made and refund of Rs.10,77,61,574/- in respect of the assessment years 2012-13 to 2018-19 has been work out to be granted to the petitioner.
3. Once there is no tax liability on the petitioner for which the petitioner’s properties could be attached, there is no justification for keeping the attachment on the properties after the fresh assessment order always had been passed and refund of Rs.10,77,61,574/- has been found to be adjusted against the existing demands.
4. In the statement filed on behalf of the respondents it is stated that the provisional attachment on the properties of the petitioner was valid only for a period of six months from the date of the order as per the provisions under Section 222(2)(b) of the Income Tax Act and the said provisional attachment could be extended up to two years or sixty days from the date of the order of assessment whichever is later. It is further stated that after expiry of period of six months or further period as the case may be, the order of attachment automatically comes to an end. In the case of the petitioner, the last attachment was on 30.12.2019 which was valid for a period of six months from 30.12.2019 and thereafter the order of attachment had become void ab initio and there is no provisional attachment on the properties of the petitioner as of today.
5. Considering the said stand of the respondents that there is no order of attachment prevailing on the properties of the petitioner, the petitioner is free to deal with his properties in the manner it likes. In view of the specific stand taken by the respondents in their statement, nothing survives in this writ Thus, the writ petition is disposed of taking note of the statement made by the respondents in paragraph 8 of the statement which would read as under:
“8. With reference to ground I, it is submitted that the provisional attachment was made on various dates such as 20.08.2019, 15.12.2019, 30.12.2019. it is pertinent to note the provisional attachment order is valid for only 6 months from the date of the order unless extended by such period with approval of the competent authority so much so that the total period of extension shall not exceed two years or sixty days from the date of order of assessment whichever is later. Hence on expiry of the period of 6 months or further extended period as the case may be the order of attachment becomes automatically void ab initio. In the case of the petitioner, the last attachment was on 30.12.2019, which was valid only for 6 months from 30.12.2019. thereafter the order of attachment becomes void ab initio as mentioned above. As a result, it is submitted that the provisional attachments that were made are null and void as on date.”
6. Thus, it is made clear that there is no attachment on the properties of the petitioner.
With the aforesaid observation, the present writ petition stands finally disposed of.
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