9911796707
TMI Blog2020 (4) TMI 370X X X X Extracts X X X X X X X X Extracts X X X X ..... issued to the 4th respondent Bank as garnishee, was under challenge in the writ petition. Inter alia, the petitioner Bank sought direction for refund of the amount paid by the 4th respondent to the Income-tax Department pursuant to Ext.P7. Contention of the petitioner was mainly that, the assessment made with respect to the amount sought to be recovered through Ext.P7 was under challenge in an appeal and that the recovery steps from the garnishee was initiated without taking into consideration of pendency of the appeal and the stay petition. Further contention raised is that, the 'garnishee proceedings' was initiated and the amount was recovered without issuing any notice to the appellant, as required under section 226(3) of the Inc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f the amounts lying in credit of the assessee and if sufficient amounts are available in the account, attachment could have been continued, without recovery, especially when the assessee had informed that the assessment is being challenged in appeal. The recovery proceedings effected by way of garnishee proceedings under section 226 has to be notified to the assessee also, as provided under section 226(3)(iii). It was found that mandate of the provision insists that a copy of the notice issued to the garnishee should be forwarded to the assessee, by relying on a decision of the Calcutta High Court in Purnima Das v. Union of India [2011] 198 Taxman 54 (Mag.)/[2010] 329 ITR 278 (Cal.), wherein it was found that it was not proper on the part o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rcising the powers of stay, the Income-tax Officer should not act as a mere tax gatherer, but as a quasi-judicial authority vested with the public duty of protecting interests of the Revenue and to mitigate the hardship to the assessee. A Division Bench of the High Court of Bombay, following the above said observations, had laid guidelines to the effect that, no recovery of tax should be made pending expiry of the time limit for filing an appeal. The said dictum was seen followed by a learned Judge of this court in the decision in Mother India Educational & Cultural Charitable Trust v. Dy. CIT 2014 KHC 353. 8. Considering the factual scenario involved in the case at hand, we have no hesitation to hold that the attachment and recovery was e ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... amount. We take note of the fact that the above aspects were not considered by the learned Single Judge while disposing of the writ petition. Hence the impugned judgment requires modification. 10. Therefore, the above writ appeal is hereby disposed of by directing the respondents 1 to 3 to make refund of the amount to the appellant society, in case the appellant society furnishes Bank Guarantee to the tune of the entire amount recovered, to the satisfaction of the first respondent. The Bank Guarantee is directed to be kept in tact, until disposal of the appeal filed by the appellant before the 2nd respondent. Needless to observe that, realization of the Bank Guarantee shall be made only after communicating the appellate order to the appell ..... X X X X Extracts X X X X X X X X Extracts X X X X
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