9911796707
TMI Blog1968 (8) TMI 16X X X X Extracts X X X X X X X X Extracts X X X X ..... he Hindu undivided family, movable and, immovable, and outstandings were attached for realizing the tax dues. In exercise of the powers conferred by rule 76 of Schedule II of the Income-tax Act, 1961, the Tax Recovery Officer directed on August 10, 1965, that Kapurchand Shrimal, manager of the family, be detained in civil prison for fifteen days. The manager then moved a petition in the High Court of Andhra Pradesh against the order of detention. The petition was rejected by a single judge of the High Court holding that the manager had, in contravention of rule 16(2) of Schedule II of the Income-tax Act, 1961, dealt with the properties of the family after receiving notice of the issue of the tax recovery certificate. In appeal against tha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to satisfy the tax due by the Hindu undivided family in enforcement of the certificate issued under section 222 of the Income-tax Act, 1961, must be upheld. By virtue of section 297(2)(j), notwithstanding the repeal of the Indian Income-tax Act, 1922, any sum payable by way of income-tax, super-tax, interest, penalty or otherwise under the Income-tax Act, 1922, may be recovered under the Act of 1961, but without prejudice to any action already taken for the recovery of such sum under the repealed Act. Proceedings could therefore be taken for recovery of the tax due for the assessment years 1955-56 to 1959-60 by the Hindu undivided family under the Income-tax Act of 1961. Section 220 of the Act of 1961 deals with payment of tax and conditi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Tax Recovery Officer shall cause to be served upon the defaulter a notice requiring the defaulter to pay the amount specified in the certificate within fifteen days from the date of service of the notice and intimating that in default steps would be taken to realise the amount under the Schedule. Rule 16 provides that where a notice has been served on a defaulter under rule 2, the defaulter shall not be competent to mortgage, charge, lease or otherwise deal with any property belonging to him except with the permission of the Tax Recovery Officer. Rule 73 provides that no order for the arrest and detention in civil prison of a defaulter shall be made unless the Tax Recovery Officer has issued and served a notice upon the defaulter calli ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ry may be taken against the assessee for recovery of the tax. But under the scheme of the Act and the Rules, the assessee alone may be treated in default. The Act and the Rules contemplate that the notice for payment of the tax arrears may be issued against the assessee, and proceedings for recovery of the tax may be taken against the assessee alone. Under the Income-tax Act, 1961, a Hindu undivided family is a distinct taxable entity, apart from the individual members who constitute that family. Section 4 of the Income-tax Act charges to tax for any assessment year, the total income of the previous year of every person and " person " is defined in section 2(31) as including--(i) an individual, (ii) a Hindu undivided family, (iii) a company ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ct, 1961, in support of his contention that when tax is assessed against the Hindu undivided family there is no distinction between the representative status of the manager of the family and his personal status. Section 140(b) authorises the manager in the case of a Hindu undivided family to sign and verify the return of income, and section 282(2) provides for the mode of service of notice or requisition issued under the Act, amongst others, against a Hindu undivided family. But because the manager of a Hindu undivided family is authorised to sign and verify the return of income and a notice under the Act could be served upon him when it is addressed to a Hindu undivided family and such service is treated as service upon the Hindu undivided ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t. Section 160 provides for treating a person as a representative assessee, and section 161 prescribes the liability of a representative assessee. Section 179 makes a special provision for rendering the directors of a private company in liquidation to be jointly and severally liable for the payment of tax which cannot be recovered from the assets of the private company in liquidation. The legislature has made no such provision for recovery of tax by resort to the personal property of the manager of the Hindu undivided family, or by his arrest and detention for default by the family in paying the tax due. Sections 276, 276A, 277 and 278 on which reliance was placed by counsel for the revenue in support of his argument also do not assist hi ..... X X X X Extracts X X X X X X X X Extracts X X X X
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