K.B.Asthana, J. - (1.) THIS appeal against an order of remand passed by the lower appellate court arises in the following circumstances: One Phool Chand was assessed to income-tax under the name and style of Sheo Prasad Phool Chand. He did not pay the income-tax dues. The Income-tax Officer concerned issued a certificate for realisation of the tax dues to the Collector in exercise of his powers under Section 46(2) of the Income-tax Act and he proceeded to recover the tax dues as arrears of land revenue. Three houses situate in Kanpur City were attached by the Collector for sale by auction. Smt. Kalawati and her son, Binda Prasad, made an application before the Collector stating that the houses attached belonged to the applicants with which the assessee, Phool Chand, had nothing to do and the same be released from attachment. The Collector rejected that application, taking the view that under the law no such application could be entertained. An appeal against this order of the Collector was dismissed by the Commissioner. Smt. Kalawati and her son, Binda Prasad, then instituted Suit No. 184 of 1962 in the Court of the First Civil Judge, Kanpur, on December 1, 1962, for a declaration that the three houses attached were not liable to be sold in respect of realisation of arrears of income-tax dues from Phool Chand or Sheo Prasad Phool Chand. To this suit were impleaded as first defendant, the Union of India, as second defendant, the Income-tax Officer, and as third defendant, Phool Chand. It may be mentioned that before instituting the said suit the plaintiffs had given notice to the first and second defendants under Section 80 of the Civil Procedure Code. Another suit was also filed by Kalawati and Binda Prasad as plaintiffs against the same defendants and others for an injunction restraining them from selling the three houses alleged to have been wrongly attached by the Collector. Both the suits were defended by the defendants, who pleaded that the three attached houses were the property of Phool Chand, the assessee, and not of the plaintiffs. Certain technical pleas were also raised regarding the validity of the notice under Section 80 of the Civil Procedure Code and regarding the maintainability of the suit. No plea was raised in the written statement that the suit was barred by limitation. The two suits were consolidated by the trial court for hearing. Necessary issues were framed on the picas raised. The substantial question that arose for determination in the suit related to the title of the plaintiffs to the three houses in dispute. The learned judge who heard the suit repelled all the technical pleas raised in defence and on the main issue found in favour of the plaintiffs holding that the three houses in dispute were the property of the plaintiffs and not that of the third defendant, Phool Chand. The result was that the Suit No. 184 of 1962 for declaration was decreed and so was the connected suit for injunction.
(2.) FROM the decrees in the two suits the defendants went up in appeal which in their turn were consolidated for hearing and disposed of by the Additional District Judge, Kanpur. In appeal it appears for the first time on behalf of the defendant-appellant that the question of limitation was agitated- A perusal of the judgment of the learned Additional District Judge shows that, while affirming the findings of the court of first instance on the question of title, he held that the suit being one for a declaration would be in the nature of a suit under Order 21, Rule 63, Civil Procedure Code, and ought to have been instituted within six months of the date of rejection of the objection of the plaintiffs before the Collector. The learned Additional District Judge further held that the question whether the plaintiffs were entitled to the exclusion of the time which elapsed during the pendency of the appeal against the order of the Collector, before the Commissioner and what was the length of that time were necessary to be determined before finding out whether the suit of the plaintiffs for declaration, namely, Suit No. 184 of 1962, was within time. Accordingly, the learned Additional District Judge allowed the appeal of the defendants, set aside the decree of the court below in the said suit and remanded the case to the court of first instance for recording of findings on the question of limitation in the light of the directions given. In the other suit, which was for injunction, the appeal of the defendants was also allowed and the learned Additional District Judge, holding that it was misconceived, dismissed it. Now Smt. Kalawati and Binda Prasad, the plaintiffs, have come up in appeal before this court in Suit No. 184 of 1962. They have conceded to the decree in the connected suit for injunction and have not appealed from the decree of the dismissal of that suit. Sri Sudhir Chandra Agarwal, learned counsel appearing for the plaintiff-appellant, in support of the appeal contended that the suit was governed by Article 120 of the First Schedule of the Limitation Act, 1908, and the court below was in error in holding that it, was governed by Article 11 of that Schedule and thus wrongly remanded the case to the trial court for further enquiry on the question of limitation. It was submitted that the attachment made by the Collector could not be an attachment of immovable property in execution of a decree within the meaning of Order 21, Rule 54, and the application which was filed by the plaintiffs before the Collector would not be an objection or claim within the meaning of Order 21, Rule 58, of the Civil Procedure Coda. Hence, the rejection of that application would not be final in the sense that no other remedy was available except by way of a suit under Order 21, Rule 63, Civil Procedure Code. It was further submitted that the instant suit was a simple suit for a declaration of rights not governed by the provisions of Order 21, Rule 63, Civil Procedure Code. It was argued that the Collector attached the houses in suit in the exercise of his powers under Section 279(f) of the U.P. Zamindari Abolition and Land, Reforms Act and not under the provisions of Order 21, Rule 54, Civil procedure Code, as a civil court in execution of a decree in a suit; hence, there was no occasion for Smt. Kalawati and Binda Prasad, whose property was wrongly attached, to prefer any claim or file any objection under Order 21, Rule 58, Civil Procedure Code, which applies only when immovable property is attached in execution of a decree. On the other hand, Sri V. P. Srivatsava holding the brief of Sri K. P. Agarwal, learned counsel for the respondent, Phool Chand, submitted that under the proviso to Sub-section (2) of Section 46 of the Indian Income-tax Act, the Collector has the power of the civil court when realising the arrears of tax and the procedure provided for attachment and sale of immovable property in execution of decrees mutatis mutandis applies as he becomes a civil court and any objection filed or claim preferred by a third party to the attachment or sale of immovable property would be nothing but a proceeding under Order 21, Rule 58, of the Code as regards the attachment and under other provisions as regards sale. The submission was that the proviso to Section 46(2) of the Indian Income-tax Act incorporates a rule of reference and it must be given full effect and when so done there will be no difference between the Collector taking proceedings by attachment of immovable property for realisation of revenue and a civil court sitting in execution attaching immovable property of the judgment-debtor in execution of a decree.
(3.) FROM the above arguments advanced before me at the Bar the basic question that arises for determination in this appeal is whether the order of the Collector rejecting the application of the plaintiffs for releasing the houses in suit from attachment or for lifting the attachment on the houses in suit was made under Order 21, Rule 58, of the Civil Procedure Code, and the instant suit which was subsequently brought would be a suit under Order 21, Rule 63, Civil Procedure Code. On behalf of the respondents reliance was placed on Deo Sharma v. Chartered Bank of India, 1955 ILR(All) 673 and Union of India v. Parvati Kuwar, AIR 1965 ALL 154. The former case was decided by a Division Bench of this court. In that case it was held that the attachment of an immovable property by the Collector in the course of recovery of income-tax dues will be deemed to be in exercise of powers under Order 21, Rule 58, of the Civil Procedure Code, as there was no provision under Section 146 of the U. P. Land Revenue Act for attachment of other immovable property of the defaulter though there was provision for the sale of such property. I do not think the ratio of the decision of that case helps the respondents as now under Section 279 of the U.P. Zamindari Abolition and Land Reforms Act, in its Clause (f), there is specific power conferred on the Collector to recover an arrear of land revenue by attachment and sale of other immovable property of the defaulter. It has not been disputed before me that the only provisions of law, which now are available in Uttar Pradesh for recovery of arrears of land revenue, are contained in the U.P. Zamindari Abolition and Land Reforms Act and the former Section 146 and certain other related sections of the U.P. Land Revenue Act stand repealed. It follows, therefore, that when the Collector takes proceedings for recovery of the income-tax dues which is realisable as arrears of land revenue he exercises his powers under the relevant provisions of the U. P. Zamindari Abolition and Land Reforms Act. In the latter case cited, which is a decision of a learned single judge of this court, the question that arose was whether a suit for a declaration that the attachment by the Collector of immovable property was null and void, which attachment was made in the course of realisation of income-tax dues as arrears of land revenue, could be filed against the Union of India without serving upon it and its officers a prior notice under Section 80 of the Civil Procedure Code ? The learned single judge held that such a suit could be filed without serving a prior notice under Section 80 of the Civil Procedure Code, as the proceedings in the suit were in continuation of the objection formerly raised before the Collector to which the Union of India and its officers were already a party. In the course of his reasoning no doubt the learned single judge drew analogy from the provisions of Order 21, Rule 58, and observed that the former objection could be deemed to be under that provision. I do not think I am bound by the reasoning or any observations made by the learned single judge in the course of his judgment. In the instant case due notice under Section 80 was served upon the Union of India before filing of the suit and no such question arises before me. In the case of Purshottam Govindji Halai v. B.M. Desai, Additional Collector of Bombay, [1955] 28 I.T.R. 891, [1955] 2 S.C.R. 887, the Supreme Court had occasion to consider the true effect of Section 46 of the Indian Income-tax Act and its proviso. The learned judges in paragraph 8 of the reported judgment observed as follows: "All that the sub-section directs the Collector to do is to proceed to recover the certified amount as if it were an arrear of land revenue, that is to say, he is to adopt the procedure prescribed by the appropriate law of his State for the recovery of land revenue and that in thus proceeding he is, under the proviso, to have all the powers a civil court has under the Code. The sub-section does not prescribe two separate procedures...... In our opinion the proviso does not indicate a different and alternative mode of recovery of the certified amount of tax but only confers additional powers on the Collector for the better and more effective application of the only mode of recovery authorised by the body of Sub-section (2) of Section 46." ;