TMI Blog2021 (4) TMI 1218X X X X Extracts X X X X X X X X Extracts X X X X ..... subsequent tax liability. The fruits of a decree will date back to the date of the suit. Section 281 of the Income Tax Act, 1961 applies only to a situation where an assessee during the pendency of any proceeding under the Act, or after completion thereof, but before the service of a notice under Rule 2 of the Second Schedule, creates a charge on, or parts with the possession (by way of sale, mortgage, gift, exchange or any other mode of transfer whatsoever) of, any of his/her assets in favour of any other person. Only such charge or transfer is void as against any claim in respect of any tax or any other sum payable by the assessee as a result of completion of the said proceedings or otherwise. In this case admittedly the transfer was on account the final culmination of the litigation by the order of Hon ble Supreme Court.There was only a delay in the execution of sale deed due to the pendency of the proceedings as the third and fourth respondent s mother declined to execute sale deed under the sale agreement dated 30.6.1994. Therefore the impugned communication dated 06.07.2018 asking the petitioner to obtain clearance from the second respondent cannot be countenance ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he registered sale deed dated 29.6.2018 vide registered document No.86/2018 to the petitioner. 4. The facts are not in dispute. The petitioner had entered into a sale agreement with the mother of the third and fourth respondents late Mrs.J.Padmini wife of late .Mr.D.Jayaraman during her lifetime on 30.06.1994. The third and fourth respondents were minors at the time of execution of sale agreement. 5. The said property is a house property. It was originally belonged to the said third and fourth respondents' father s family. Late Mrs.J.Padmini the mother of the third and fourth respondents along with the third and fourth respondents became subsequent owners of the said property. 6. At the time of execution of the aforesaid sale agreement dated on 30.06.1994, the sale consideration for the property was fixed at ₹ 16,75,000/-. The petitioner is said to have paid an advance amount of ₹ 3,20,000/- to the said late Mrs.J.Padmini at the time of the execution of the sale agreement dated 30.06.1994. After execution of the sale agreement dated 30.06.1994, late Mrs.J.Padmini however refused to execute the sale deed in favour of the petitioner. 7. Since sale deed was ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... other, ( 2015) 5 SCC 775 ii. Tax Recovery Officer II Vs. Gangadhar Vishwanath Ranade, (1998) 6 SCC 658 iii. M/s Agasthiya Holdings Pvt., Ltd., Vs. Commissioner of Income Tax, 2018 (403) ITR 288 15. The first respondent has opposed the prayer in the Writ Petition on the ground that M/s. Beetle Exports and M/s. Ultimate Solutions, two partnership firms of which the fourth respondent and her husband Mr.V.Balasubramaniam were tax defaulters and in arrears of tax for the Assessment Year 2012-13 and 2013 and 14 as detailed below:- Assessee Assessment Year Amount of tax and interest due (in Rs.) Beetle Exports 2012- 2013 80,49,900/- Beetle Exports 2013- 2014 40,81,620/- Ultimate Solution 2013- 2014 26,22,690/- 16. It is submitted that since the two firms were in arrears of tax, on 26.10.2016, the case was referred to the first respondent to recover the tax and interest due from them. Thereafter, a notice dated 07.11.2016 was issued to them as assesse ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... persons had incurred subsequent tax liability. The fruits of a decree will date back to the date of the suit. 23. In fact, the records also indicate that earlier an application in H.M.G.O.P No.433 of 1994 was filed by late Mrs.J.Padmini before the Principal District Court, Coimbatore to obtain court s permission to execute the sale deed. If IT was however withdrawn by her. Thus, the attachment of the property on 27.03.2017 by the officer of the 1st respondent cannot override the commitment under sale agreement dated 30.6.1994. 24. Section 281 of the Income Tax Act, 1961 applies only to a situation where an assessee during the pendency of any proceeding under the Act, or after completion thereof, but before the service of a notice under Rule 2 of the Second Schedule, creates a charge on, or parts with the possession (by way of sale, mortgage, gift, exchange or any other mode of transfer whatsoever) of, any of his/her assets in favour of any other person. 25. Only such charge or transfer is void as against any claim in respect of any tax or any other sum payable by the assessee as a result of completion of the said proceedings or otherwise. 26. In this case admittedly the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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