RUCHI MEHTA Vs. UNION OF INDIA

JUDGEMENT

(1.) Rule. Heard forthwith. The petitioners have approached this Court to impugn the order dt. 27th June, 2007 in respect of the property identified at serial No. 2 of the said order. The order is purported to have been made by respondent No. 3 in the purported exercise of his powers under Section 281 of the IT Act, 1961.

(2.) One M/s Simplex Enterprises had booked and was allotted shop No. 4 admeasuring 2403 sq. ft. (with 1,437 sq. ft. of Mezzanine floor) in Virwani Plaza at Pune in June, 1988. The defaulter paid the earnest money for procuring the said allotment. On 23rd Jan., 1997 an ITCP-1 was served for recovery of the outstanding demand. In June, 1997 the defaulter paid the balance money to the builder and obtained the possession of the said shop. In July, 1998 the petitioner purchased rights, title and interest of the defaulter in the said shop. Sale deed was executed between the builders and the petitioners for sale of the said shop in November, 1998 with the defendants as a confirming party.

(3.) The TRO at Pune under the certificate from TRO Ward 18, Mumbai attached the said shop on 10th Jan., 2001. That was challenged before the CIT. After considering various contentions, the CIT held that as on 23rd Jan., 1997 what the defaulter owned was a mere allotment letter which was not an immovable property. The status of movable property was changed into immovable property when the balance amount was paid to the builders and the possession was taken by the defaulter. This happened in June, 1998. Until then the status of the property continued to be movable property. This being so, the correct approach for the TRO was to attach this allotment by sending a notice to the builders. This notice could be under Section 226(3) of ITCT 3 of Second Schedule of the IT Act. There was nothing on record, that any communication was ever made with the builders in this regard during the four years period from 23rd Jan., 1997 to 30th Nov., 2000 (i.e. when first letter was written to the petitioner). Some other reason was also given. By order dt. 27th Aug., 2003 the CIT held that the notice is non est and set aside the action taken of attachment of the subject property. Consequently attachment of shop No. 4 was vacated.