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2012 (8) TMI 541 - HC - Income TaxWhether in view of sub-section (1) of section 281 of the Income-tax Act, 1961, the charge created against the property in question by mortgaging the property by the second respondent-assessee borrower in favour of the first respondent-financial institution during pendency of any of the proceedings under the Income-tax Act, 1961, is void as against any claim in respect of income-tax and other sum payable by the second respondent-assessee in favour of the petitioner- Revenue. As the proviso to sub-section (1) of section 281 stipulates a notice relating to such pendency of the income-tax proceeding or payment of tax payable by the assessee, the Revenue cannot take the plea that the first respondent had knowledge of the pendency of the proceeding and thereby it is open to the first respondent to derive advantage of clause (i) of the proviso to sub-section (1) of section 281 of the Income-tax Act, 1961, so far as it relates to charge created by the second respondent in favour of the first respondent-financial institution by equitable mortgage of the immovable property in question, as against any claim in respect of any tax or any other sum payable by the assessee as a result of completion of any proceeding or otherwise by the petitioner-Revenue.
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