TMI Blog1967 (4) TMI 3X X X X Extracts X X X X X X X X Extracts X X X X ..... urt allowing the petition fled under article 226 of the Constitution by Budha Pictures, Madras, respondent before us. The respondent had, inter alia, prayed for a writ of mandamus or such other appropriate writ, order or direction in the nature of a writ directing the 4th Income-tax Officer, City Circle V, Madras, to forbear from collecting from the respondent the sum of Rs. 20,000 in pursuance of his notices dated June 18, 1959, and March 21, 1961, issued under section 46(5A) of the Indian Income-tax Act, 1922. These notices came to be issued in the following circumstances : One, T. S. Baliah, a cine-artist, was apparently in arrears of income-tax. The III Additional Income-tax Officer sent a letter dated June 18, 1959, to the responden ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... plied on June 26, 1959, as follows : " We have not engaged Sri T. S. Baliah for acting in our production No. 2. Hence, there is no contract with the said Sri T. S. Baliah, and consequently we are unable to comply with your request. On March 22, 1961, another communication was sent enclosing a notice under section 46(5A) of the Indian Income-tax Act. The notice is in the same form except that the sum to be recovered had increased to Rs.86,111-12-0. The respondent replied on March 25, 1961, saying that " there are no payments due and payable to Shri T. S. Baliah, cine-artist, as on the date of receipt of your letter. " The respondent enclosed a statement of account which showed that on March 28, 1960, a cheque for Rs. 7,000 was given to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tioned, held that the department was not entitled to call upon Budha Pictures Ltd., the respondent, to make good the sum of Rs. 20,000 already paid to Baliah as such payments did not contravene the notice under section 46(5A) dated June 18, 1959. Section 46(5A) reads as follows : " (5A) The Income-tax Officer may at any time or from time to time, by notice in writing (a copy of which shall be forwarded to the assessee at his last address known to the Income-tax Officer) require any person from whom money is due or may become due to assesse or any person who holds or may subsequently hold money for or on account of the assessee to pay to the Income-tax Officer, either forthwith upon the money becoming due or being held or at or within the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to whom a notice under this sub-section is sent objects to it on the ground that the sum demanded or any part thereof is not due to the assessee or that he does not hold any money for or on account of the assessee, then, nothing contained in this section shall be deemed to require such person to pay any such sum or part thereof, as the case may be, to the Income-tax Officer. " The learned counsel for the appellant contends that section 46(5A) applies in four sets of circumstances : (1) when money is due from a person to the assessee ; (2) when money may become due to the assessee ; (3) when a person holds money for an assessee ; and (4) when a person may hold money on account of the assessee. He says that there is no reaso ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... not hold any money on account of the assessee. He has not to say that he is not likely to owe or to hold money. It seems to us that the expressions " may become due " or " may subsequently hold money " suggest, in the context, a subsisting relationship between the person served with a notice and the assessee, e.g., assessee's employer, or banker, or debtor, or a person paying annuity to him ; they do not suggest a bank with which he has never dealt, a person he has never lent money to or dealt with, or all persons who may possibly in the future employ an assessee out of job or work. If the contention of the department were to be accepted, the Income-tax Officer could send a circular letter under section 46(5A) in respect of all defaulters ..... X X X X Extracts X X X X X X X X Extracts X X X X
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