TMI Blog2022 (2) TMI 940X X X X Extracts X X X X X X X X Extracts X X X X ..... for the purposes of protecting the interest of Revenue, it is necessary so to do, he may with the previous approval of the higher authority pass an order in writing provisionally attaching the property belonging to the assessee. These are drastic powers permitting the Assessing Officer to attach any property of an assessee even before the completion of assessment or reassessment. These powers are thus in the nature of attachment before judgment. They have provisional applicability and in terms of sub-section (2) of section 281B of the Act, a limited life. Such powers must, therefore, be exercised in appropriate cases for proper reasons. Such powers cannot be exercised merely by repeating the phraseology used in the section and recording the opinion of the officer passing such order that he was satisfied for the purpose of protecting the interest of Revenue, it was necessary so to do. The assessee in the case on hand is Arnav Savaliya. The provisional attachment is of the property, which belongs to the writ-applicant Partnership Firm. The plain language of the provision of Section-281B is plain and simple. It provides for the attachment of the property of the assessee only ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... impugned order dated 29.05.2021 at Annexure- A to this petition so far as attachment over in respect for land admeasuring 11981 sq.mtr. Land situated at Block No.142, New Block No.166, T.P. 22, F.P.53, Village Valak, Taluka Kamrej, District Surat; (B) Quash and set aside the amendment. Record made in the Village Form Number 7 at Annexure B in relation to land admeasuring 11981 sq.mtr. Land situated at Block No.142, New Block No.166, T.P. 22, F.P.53, Village Valak, Taluka Kamrej, District Surat consequence to the order at Annexure- A dated 29.05.2021. (C) Pending the admission, hearing and final disposal of this petition, to stay operation of the order at Annexure - A to this petition to the limited extent to attachment over land admeasuring 11981 sq.mtr. Land situtated at Block No.142, New Block No.166, T.P. 22, F.P.53, Village Valak, Taluka Kamrej, District Surat as well as to stay the operation of amendment in Village Form Number 7 dated 29.05.2021 (Annexure B); (D) Any other and further relief deemed just and proper begranted in the interest of justice; (E) To provide for the cost of this petition. 2. The facts giving rise to this writ-application ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 2 of the I.T. Act, 1961 was issued by the Pr. DIT(Inv.), Surat in the case of the assessee on 05/02/2020 at 95, Mahendra Park Society, Besides Suzuki Showroom, Puna Khambharia Road, Surat. 2. Further, during the course of search proceedings in the case of Shri Arnav Savaliya u/s.132 of the I.T. Act conducted in the premises of 95, Mahendra Park Society, Besides Suzuki Showroom, Puna Khambharia Road, Surat various incriminating documents were found and seized having implication of large amount of unaccounted income during the financial year 2013-14 to 2019-20 relevant to AY 2020-21. 3. In view of the seized material found during the course of search conducted u/s.132 in the premises of the assessee which belonged to Shri Arnav Savaliya, there is a likelihood of huge demand being raised in the case of the above assessee on the basis of investigations/enquires being conducted during the course of assessment proceedings. The assessment proceedings u/s.153A for Assessment Year 2014-15 to 2019-20 is in progress. Accordingly, I am of the opinion that for the purpose of protecting the interest of Revenue it is necessary to attach provisionally the properties belonging to the asse ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ther, all persons are prohibited from taking any benefit under such transfer or create any charge in the said property without written prior approval from undersigned. This order is passed with the approval of the Pr. Commissioner of Income Tax (Central), Surat vide letter No.SRT/PR, CIT (Central))/ 281B/ Shree Kuberji Ambaji Gr/2021-22, dated 22.04.2021. Sd/- DEVANGI BHARATAN MARTHAK CENTRAL CIRCLE 4, SURAT 2.5 The second last property in the above table is Block No.142. This land bearing Block No.142 is of the ownership of writ-applicant Partnership Firm. There is no dispute in this regard. However, it appears that alongwith the personal properties of Arnav Savalaiya, the Block No.142 owned by the writ-applicant Firm also came to be included and provisionally attached on the ground that Arnav Savaliya paid the cash consideration referred to above and thereby, derived 2.5% share in the profit from Nitaben Radadiya i.e. one of the partners of the writ-applicant Firm. 3. Being dissatisfied with the aforesaid action on the part of the department, the writ-applicant is here before this Court with the present writ-application. SUBMISSIONS ON BEH ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the assignee partner would otherwise be entitled and the assignee must accept the account of profits agreed to by the partners. In the case of a dissolution, the assignee is entitled to receive the share of partnership assets, to which, the assignee partner is entitled and for purpose of ascertaining that share, to an account as from the date of the dissolution. 7. Mr. Soparkar also placed reliance on a decision of the Supreme Court in the case of Addanki Narayanappa Anr. vs Bhaskara Krishtappa And 13 Ors. reported in AIR 1966 SC 1300. He submitted that the partnership property will vest in all partners. During the subsistence of the partnership, no partner can deal with any portion of the property as his/her own. Nor can be assigned his/her interest in a specific item to anyone. 8. Mr. Soparkar, thereafter, invited the attention of this Court to the provisions of Order 21 Rule 49 of the Code of Civil Procedure. Order 21 Rule 49 reads thus:- Order 21 Rule 49: Attachment of partnership property: (1) Save as otherwise provided by this rule, property belonging to a partnership shall not be attached or sold in execution of a decree other than a decree passed a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... latter case, the sub-partnership acquires a special interest in the main partnership. Mr. Soparkar vehemently submitted that the case on hand is not one, wherein, Nitaben as one of the partners of the writ-applicant Firm could be said to have created a sub-partnership with her share. In view of Section 29(1) of the Partnership Act, Arnav Savaliya as an assignee at the most becomes entitled to receive the assigned share in the profits from the firm. Arnav Savaliya would not be entitled to receive the assigned share in the profits as a sub-partner because no sub-partnership came into existence, but as an assignee he may be entitled to the share of profit of the assigner-partner i.e. Nitaben Radadiya. 12. Mr. Soparkar would submit that the theory of assignment isalso that of the department, however, for the time being even if it is assumed that Nitaben assigned her share to the extent of 2.5% in the profit, the department could not have proceeded to provisionally attach the Block No.142 as this land is the asset of the ownership of the writ-applicant firm. 13. Mr. Soparkar also invited our attention to Rule-32 of the Schedule-2 Procedure of Recovery of Tax. Rule 32 reads ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... said to have assigned 2.5% of her share in the profit in favour of Arnav Savaliya. According to Ms. Raval in such a scenario, it could be said that Arnav Savaliya has a share in Block No.142. 16. Ms. Raval invited the attention of this Court to few averments made in the affidavit-in-reply filed on behalf of the revenue. We quote the relevant averments as contained in the reply. 4. Before entering into a parawise response to the petition of the petitioners, the respondents seek leave to raise a preliminary objection with respect to the maintainability of the petition. The petitioner submits that there is a statutory alternative remedy available to the petitioner, which is efficacious. The petitioner seeks from this Hon'ble Court, in exercise of writ jurisdiction, an examination of the issue on facts, which exercise the petitioner cannot seek, in the humble submission of the answering respondent. 5. With respect to contentions raised in Para 1, it is submitted that upon verification, the said land although was purchased in the name of the firm i.e.M/s Raghunandan Enterprise vide registered deed no.6362 on 09.04.2015, Smt. Nitaben Shaileshbhai Radadiya, wife of the Sh ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t to contentions raised in Para 2.3, it is submitted that as per explanation in Para 1, it is clearly seen that Shri Arnav M Savaliya has purchased unofficially 2.5% share out of 5% share of impugned land from Shri Shailesh Harjibhai Radadiya by paying huge on-money. The on-money payments in relation to land investment shall never become part of the register document/deed. Accordingly, the on-money profit on sale of such land shall also be out of regular books of account and document too. The accounting and share of profit in relation to on-money, are done through MOU, Saudachitthi, Samadhan Karar. In this impugned land also the same was done through unregistered document (Sauda Chitthi) signed by the parties. The contention of the petitioner deserves no merit when it comes to dealing in on-money transaction for purchase of land. 9. With respect to contentions raised in Para 2.4, it is submitted that as per section 132(9B) of the I.T. Act, 1961, [(9B) Where, during the course of the search or seizure or within a period of sixty days from the date on which the last of the authorizations for search was executed, the authorised officer, for reasons to be recorded in writing ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e 31st March, 2022. 12. With respect to contentions raised in Para 3.1, it is submitted that, as per the incriminating document seized during the course of search u/s.132 of the I.T. Act in the case of Shri Arnav Mukeshbhai Savaliya, the 2.5% share of the impugned land was sold by receiving huge on-money by Shri Shailesh Harjibhai Radadiya (husband of Smt. Nitaben Shaileshbhai Radadiya). It is pertinent to mention here that the on-money payments in relation to land investment don t become part of the register document/deed. Similarly, the on-money profit on sale of such land shall also be out of regular books of account and document too. The accounting and share of profit in relation to on-money, are generally done through MOU, Saudachitthi, Samadhan Karar. In this impugned land also the same was done through unregistered document signed by the parties. The contention of the petitioner deserves no merit when it comes to dealing in on-money transaction for purchase of land. The impugned land was transferred over and above the registered value and involves on-money payments also. The contention of petitioner that Shri Arnav Mukeshbhai Savaliya is neither the partner in partnersh ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tution of India, more particularly, when it comes to protecting the interest of the revenue. Ms. Raval would submit that the necessary evidence as regards the understanding between the parties may surface during the course of the assessment proceedings. That may make the picture more clear. No prejudice would be caused to the writ-applicant Firm, if till the final assessment is framed, the Block No.142 remains provisionally attached. 18. Ms. Raval also invited the attention of this Court to Subsection (3) of Section 281B of the Act, which reads thus:- 281B. Provisional attachment to protect revenue in certain cases.: (3) Where the assessee furnishes a guarantee from a scheduled bank for an amount not less than the fair market value of the property provisionally attached under sub-section (1), the Assessing Officer shall, by an order in writing, revoke such attachment: Provided that where the Assessing Officer is satisfied that a guarantee from a scheduled bank for an amount lower than the fair market value of the property is sufficient to protect the interests of the revenue, he may accept such guarantee and revoke the attachment. 19. Relying on the afores ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in language of the provision of Section-281B is plain and simple. It provides for the attachment of the property of the assessee only and of no one-else. The golden rule of interpretation of the statutes is that the statute has to be construed according to its plain, literal and grammatical meaning, unless it leads to absurdity. The subject land i.e. Block No.142 not being the property of the assessee as such, was not open to provisional attachment. Even if we go by the case of the revenue that there is some interest of Savaliya involved in the land in question, the same will not make the subject land of the ownership of the assessee i.e. Arnav Savaliya. 24. We once-again remind ourselves of the fine distinction drawn by the Supreme Court in the case of Sunil J. Kinariwala (Supra) between a case where a partner of a firm assigns his/her share in favour of a third person and a case where a partner constitutes a sub-partnership with his/her share in the main partnership. The case on hand indisputably is not one of a sub-partnership though in view of Section-29(1) of the Partnership Act, Arnav Savaliya as an assignee may become entitled to receive the assigned share in the profits ..... X X X X Extracts X X X X X X X X Extracts X X X X
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