Writ petition challenging Debts Recovery Tribunal order creating charge on Schedule A property and Recovery Officer notice. Court held petitioner has effective alternative remedy before Recovery Officer to contest property attachment.
Petition dismissed; liberty reserved to file appropriate application before Recovery Officer.
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NC: 2024:KHC:33690 WP No. 47862 of 2019
IN THE HIGH COURT OF KARNATAKA AT BENGALURU
DATED THIS THE 21ST DAY OF AUGUST, 2024
BEFORE
THE HON'BLE MR JUSTICE M.G.S. KAMAL WRIT PETITION NO. 47862 OF 2019 (GM-DRT)
BETWEEN:
MR. DINKAR ARJAN DEV UPPAL AGED ABOUT 46 YEARS, S/O LATE MR ARJAN DEV UPPAL, R/AT NO.61, VISHWA KETU-2. OPP. IOC PETROL BUNK, JUDGES BUNGALOW ROAD, BODAKDEV, AHMEDBAD-380059 GUJARAT.
…PETITIONER
(BY SRI. SUMANTHA S., ADVOCATE; SRI. APPAIAH P B.,ADVOCATES)
AND:
Digitally signed by SUMA B N Location: High Court of Karnataka
NC: 2024:KHC:33690 WP No. 47862 of 2019
…RESPONDENTS
(BY SRI. M.N. KUMAR.,ADVOCATE FOR R1; SRI. C. VINAY SWAMY., ADVOCATE FOR R2 AND R3)
THIS WRIT PETITION IS FILED UNDER ARTICLE 226 OF THE CONSTITUTION OF INDIA PRAYING TO QUASH THE NOTICE DATED 27 AUGUST 2019 ISSUED BY R-1 TO 4 AS AT ANNX-A. QUASH THE ORDER DATED 28 AUGUST 2009 PASSED BY THE DEBTS RECOVERY TRIBUNAL AT BANGALORE IN OA NO.270/2009, AS AT ANNX-B, IN SO FAR AS IT PURPORTS TO CREATE A CHANGE OVER THE SCHEDULE-A PROPERTY AS DESCRIBED IN THE NOTICE DATED 27 AUGUST 2019 AS AT ANNX-A AND ETC.
THIS PETITION, COMING ON FOR PRELIMINARY HEARING, THIS DAY, ORDER WAS MADE THEREIN AS UNDER:
CORAM: HON'BLE MR JUSTICE M.G.S. KAMAL
NC: 2024:KHC:33690 WP No. 47862 of 2019
ORAL ORDER
Petitioner is before this Court seeking following reliefs;
1) Issue an Order, Direction or Writ in the nature of Certiorari quashing the Notice bearing DCP 6094 in OA No.270/2009 dated 27 August 2019 issued by Respondent No.1 to Respondent No.4, as at Annexure - A;
2) Issue an Order, Direction or Writ in the nature of Certiorari quashing the Order dated 28 August 2009 passed by the Debts Recovery Tribunal at Bangalore in OA No.270/2009, as at Annexure - B, in so far as it purports to create a charge over the Schedule 'A' property as described in the Notice dated 27 August 2019 as at Annexure- A;
3) Award to the Petitioner the costs of these proceedings; and,
4) Grant such other and further reliefs and pass such other and further orders that this Hon'ble Court may deem fit in the facts of circumstances of the case, in the interests of justice and equity".
Officer referring to Sections 29 and 30 of the Recovery of the Debts and Bankruptcy Act, 1993 submits that petitioner has remedy as provided thereunder apart from preferring an appeal and seeks for dismissal of the petition.
"29. Application of certain provisions of Income-tax Act. -The provisions of the Second and Third Schedules to the Income-tax Act, 1961 (43 of 1961) and the Income-tax (Certificate Proceedings) Rules, 1962, as in force from time to time shall, as far as possible, apply with necessary modifications as if the said provisions and the rules referred to the amount of debt due under this Act instead of to the Income-tax:
Provided that any reference under the said provisions and the rules to the "assessee" shall be construed as a reference to the defendant under this Act.
[30. Appeal against the order of Recovery Officer.-( 1) Notwithstanding anything contained in section 29, any person aggrieved by an order of the Recovery Officer made under this Act may, within thirty days from the date on which a copy of the order is issued to him, prefer an appeal to the Tribunal.
(2) On receipt of an appeal under sub-section (1), the Tribunal may, after giving an opportunity to the appellant to be heard, and after making such inquiry as it deems fit, confirm, modify or set aside the order made by the Recovery Officer in exercise of his powers under sections 25 to 28 (both inclusive).]"
4. It is necessary also to refer to Schedule II
providing procedure for recovery of tax as per the Income
Tax Act, 1961. In that Rule 11 providing for investigation by the Tax Recovery Officer reads as under:
"Investigation by Tax Recovery Officer.
11. (1) Where any claim is preferred to, or any objection is made to the attachment or sale of, any property in execution of a certificate, on the ground that such property is not liable to such attachment or sale, the Tax Recovery Officer shall proceed to investigate the claim or objection:
Provided that no such investigation shall be made where the Tax Recovery Officer considers that the claim or objection was designedly or unnecessarily delayed.
(2) Where the property to which the claim or objection applies has been advertised for sale, the Tax Recovery Officer ordering the sale may postpone it pending the investigation of the claim or objection, upon such terms as to security or otherwise as the Tax Recovery Officer shall deem fit.
(3) The claimant or objector must adduce evidence to show that-
(a) (in the case of immovable property) at the date of the service of the notice issued under this Schedule to pay the arrears, or
(b) (in the case of movable property) at the date of the attachment,
he had some interest in, or was possessed of, the property in question.
(4) Where, upon the said investigation, the Tax Recovery Officer is satisfied that, for the reason stated in the claim or objection, such property was not, at the said date, in the possession of the defaulter or of some person in trust for him or in the occupancy of a tenant or other person paying rent to him, or that, being in the possession of the defaulter at the said date, it was so in his possession, not on his own account or as his own property, but on account of or in trust for some other person, or partly on his own account and
partly on account of some other person, the Tax Recovery Officer shall make an order releasing the property, wholly or to such extent as he thinks fit, from attachment or sale.
(5) Where the Tax Recovery Officer is satisfied that the property was, at the said date, in the possession of the defaulter as his own property and not on account of any other person, or was in the possession of some other person in trust for him, or in the occupancy of a tenant or other person paying rent to him, the Tax Recovery Officer shall disallow the claim.
(6) Where a claim or an objection is preferred, the party against whom an order is made may institute a suit in a civil court to establish the right which he claims to the property in dispute; but, subject to the result of such suit (if any), the order of the Tax Recovery Officer shall be conclusive".
aspect of the matter, it is clear that petitioner has effective
and alternate remedy of approaching the Recovery Officerrespondent No.1 in the present writ petition by raising all objections and urging all contentions seeking release of the property. Reserving such liberty, petition is disposed of.
technical issue with regard to limitation, the Recovery Officer shall entertain the application, if filed within 30
NC: 2024:KHC:33690 WP No. 47862 of 2019
days from the date of receipt of certified copy of this order. The Recovery Officer shall thereafter dispose of the application in accordance with law after affording sufficient opportunity to the parties concerned within further period of four months thereafter. Parties shall co-operate in expeditious disposal of the application.
Sd/(M.G.S. KAMAL) JUDGE
RU/SBN, List No.: 1 Sl No.: 24
3 issues framed by the court
Whether the petitioner has an effective alternative remedy before the Recovery Officer instead of approaching this Court via writ petition.
Whether the petitioner can seek release of Schedule 'A' property attached under the RDB Act through the statutory mechanism provided in Section 30.
Whether the Recovery Officer should entertain the application and dispose of it within the statutory timelines.
4 provisions across 2 enactments
Mr. Dinkar Arjan Dev Uppal
The Recovery Officer - 2 Debts Recovery Tribunal Bengaluru
Canara Bank Majestic Branch
Canara Bank ARM-I Branch
Mrs. Sowbhagya N.A.
M.G.S. Kamal
As recorded by the court registry
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