Rastogi, J. - (1.) BY means of this petition under Article 226 of the Constitution, the petitioner, Hari Prasad, challenges the recovery proceedings taken against him for recovery of certain income-tax dues for the assessment years 1943-44 and 1944-45, outstanding against M/s. Pooran Mal Onkar Mal, Deoria.
(2.) THE facts as set out in the petition are that ex parte assessments were made under Section 23(4) of the Indian I.T. Act, 1922, against M/s. Pooran Mal Onkar Mal of Deoria, an HUF, for the assessment years 1943-44 and 1944-45 in respect of income-tax and excess profits tax. THEse assessments were made on December 31, 1946. THE family tree of this HUF was as under: JUDGEMENT_48_ITR145_1984Html1.htm Hari Prasad is the petitioner before us. On the basis of the aforesaid assessments two notices of demand dated December 31, 1946, were served on the assessee, HUF. The notice in respect of assessment year 1943-44, stated that a sum of Rs. 53,411-12 annas as specified in the attached form had been determined payable by it and in the notice for the assessment year 1944-45, the sum mentioned was Rs. 40,216-7 annas. According to the petitioner these demand notices were in respect of income-tax dues only and in respect of excess profits tax liability no demand was ever issued by the I.T. Dept. Further, according to the petitioner the aforesaid two notices of demand were not served on the assessee. Later on, a recovery certificate dated March 27, 1947, for a sum of Rs. 2.55,366-14 annas was issued against Seth Mohan Lal Marwari Deoriwala, r/o Pahari Kothi, Ayodhya, District Faizabad, Under Section 46(2) of the Act by the III Addl. I.T.-cum-E.P.T. Officer, Cawnpore, to the Collector, Faizabad, and thereafter a so called duplicate recovery certificate dated August 11, 1951, for a sum of Rs. 2,35,447-7 annas against Pooran Mal Onkar Mal, Deoria, was issued by the ITO, B-Ward, Gorakhpur, to the Collector, Deoria, under the same provision. On the basis of this recovery certificate the Collector, Deoria, attached the petitioner's house situate in the town of Deoria, on July 12, 1953. According to the petitioner he had already executed a sale deed in respect of his share in the said house in favour of Kanhaiya Lal Khandelia on November 26, 1951. Sri Khandelia filed an objection before the Collector, Deoria, against the aforesaid attachment. That objection was rejected. Then, he filed a suit for injunction but withdrew it with permission to file a fresh suit and then he filed suit No. 22 of 1961, in the Court of the Civil Judge, Deoria, for injunction. That suit was dismissed on May 14, 1963. Sri Khandelia filed a First Appeal, being F.A. No. 245 of 1963, against that judgment and decree in this court. That appeal was dismissed on May 5, 1977. On February 28, 1977, the petitioner came up to this court by way of Civil Misc. Writ Petition No. 102 of 1977. That petition was dismissed summarily on May 11, 1977, on the ground that an alternative remedy was available to the petitioner. In the meantime the TRO, Gorakhpur, issued a proclamation of sale on April 6, 1977, and the attached property was sold on May 12, 1977, for a sum of Rs. 2,30,000. The auction purchasers were Deoki Nandan Khandelia and Sitaram Motani, respondents Nos. 5 and 6.
(3.) THE petitioner filed an objection under rr. 9 and 11 of the Second Schedule to the Act before the TRO, Gorakhpur, respondent No. 2, on June 2, 1977. Respondent No. 2 dismissed that objection by his order dated January 31, 1979. THE petitioner's appeal under Rule 86(1)(c) of the Schedule to the Act was dismissed by the Tax Recovery Commissioner, Allahabad, respondent No. 1 on December 7, 1979. THEreafter, respondent No. 2 was going to take action for confirmation of sale but before that could be done the petitioner filed the instant petition praying for quashing the entire recovery proceedings, for quashing the orders dated January 31, 1979, and December 7, 1979, passed by respondents Nos. 2 and 1 respectively and for setting aside the auction sale dated May 12, 1977. THEre is also a prayer for the issue of a writ of prohibition restraining respondents Nos. 1 and 2 from realizing the impugned tax dues from the petitioner. A counter affidavit has been filed by respondents Nos. 1, 2 and 4. Some of the facts, set out in the petition, are not admitted and have been controverted. It has been averred that at the material time Sri Mohan Lal was the karta of the HUF. M/s. Pooran Mal Onkar Mal and Sohan Lal and Hari Prasad were the other co-partners. Since the HUF did not pay the demand raised, a recovery certificate dated March 27, 1947, was issued by the EPTO-cum-ITO, Kanpur, for Rs. 2,55,366-14 annas to the Collector, Faizabad, in the name of Sri Mohan Lal Marwari Deoriawala, Pahari Kothi, Ayodhya, District Faizabad. The Collector, Faizabad, could not realize the outstanding arrears and hence an amended certificate dated August 11, 1951, was issued to the Collector, Deoria, for Rs. 2,35,447-7 annas by the ITO, B-Ward, Gorakhpur, in the name of M/s. Pooran Mal Onkar Mal, Deoria. The Collector, Deoria, attached the house No. D-36, Mohan Road, Bharauli Bazar, Deoria, on July 12, 1953. Mohan Lal and Sohan Lal had sold portion of this house to Sri Krishna while the petitioner, Hari Prasad, had sold a portion to Kanhaiya Lal Khandelia during the recovery proceedings. These two purchasers filed objections before the Collector, Deoria, which were dismissed. Appeals filed before the Commissioner, Gorakhpur, were also dismissed and then the matter was agitated by them before this court. Here also they failed and it was held that the sale was not bona fide and had been made to avoid payment of tax. Thereafter, auction sale was held on May 12, 1977, against which the petitioner, Hari Prasad, filed an objection under Rule 11 of the Second Schedule to the Act. That objection was subsequently treated as one under Rule 9. Before that the petitioner had filed a writ petition before the High Court which was dismissed.;