A. Mohan Alankamony, Accountant Member - This Miscellaneous Petition is filed by the assessee praying for rectification of mistake committed in the order of the Tribunal in para 13.7 in ITA No.1613/Mds/2013 dated 15.04.2015. The Ld.A.R submitted before us that the Bench had made a remark in its Order that "on this we can only say that since addition under section 68 of the Act stand deleted by this order, the demand raised by the Revenue ceased to exist, therefore, the attachment made by the Revenue is not warranted" with respect to the prayer of the assessee viz., "if the matter is decided in favour of the assessee, the Revenue may be directed to lift the attachment imposed on the assets of the assessee". The Ld.A.R submitted that the Tribunal ought to have directed the Revenue to lift the attachment as the demand was erased because the order of the Tribunal being in favour of the assessee. It was further submitted that the Revenue is withholding the lifting of the attachment of the immovable properties of the assessee for the reason that the Tribunal had not directed the Revenue to lift the attachment and had kept the issue open.
2. At the outset, we must say on this issue that, there is no mistake in the order of the Tribunal because the Tribunal has consciously and carefully worded its Order keeping in view of any other probable existing demand pertaining to the assessee for other assessment years, which the bench is not aware.
3. The learned Authorized Representative further argued before us stating that pursuant to the order of the Tribunal, the order of the learned Commissioner of Income Tax (Appeals) for the subsequent assessment year and the order of the Ld.A.O giving effect to the Order of the Tribunal for relevant assessment year, the demand has substantially reduced below Rs.15 lakhs, but inspite of the same, the Revenue has deliberately and vindictively failed to lift the attachment withholding the assets of the assessee worth several crores which not only disrupted the business of the assessee but also opportunities were lost for realizing lucrative sale propositions of the immovable properties of the assessee.
4. When the Bench queried, the learned Departmental Representative made elaborate submissions stating that, the attachment of the immovable property of the assessee can be lifted only as per the provisions of the Act i.e., after the final disposal of the case by the Hon'ble Apex Court in favour of the assessee reducing the demand to nil. The learned Departmental Representative relied on the provisions of section 225(3) of the Act for arriving at such conclusion. The learned Departmental Representative also relied in the decision of the Hon'ble High Court of Calcutta in the case of ITO v. Ghanshyamdas Jatia [1976] 105 ITR 693 while as the learned Authorized Representative relied in the decision of the Hon'ble Jurisdictional Madras High Court in the case of Sri Lakshmi Brick Industries v. Tax Recovery Officer [2014] 223 Taxman 50 (Mag.)/40 taxmann.com 247, wherein the Hon'ble High Court observed as under:—
"Where order of the Tribunal was in favour of the assessee and had been given effect, the Tax Recovery Officer was bound to give effect to the order of the Assistant Commissioner who accepted the order of the Tribunal."
The learned Departmental Representative countered the argument of the Ld.A.R by stating that the Revenue has not accepted the decision of the Tribunal and had appealed against the same, therefore the decision of the Hon'ble Madras High Court is not binding in the case of the assessee.
5. Before us, the learned Departmental Representative also conceded that the aggregate demand against the assessee for all the assessment years is below 15 lakhs by virtue of the order of the Tribunal, the Order of the Ld.A.O giving effect to the Order of the Tribunal and the order of the learned Commissioner of Income Tax (Appeals) for the subsequent assessment year. The D.R further submitted that there is no mistake in the order of the Tribunal and therefore the miscellaneous petition of the assessee may be dismissed.
6. We have heard the rival submissions and carefully perused the materials on record. Section 222(1) of the Act mandates the Tax Recovery Officer to draw a statement in the prescribed form specifying the amount of arrears due from the assessee termed as "certificate". Pursuant to which he shall proceed to recover the demand in accordance with the Rules laid down in the 2nd Schedule which includes attachment and sale of immovable property. Section 225 (2) & (3) of the Act also mandates the Tax Recovery Officer to amend the certificate, if the outstanding demand is reduced in the appeal proceedings or cancel the same if the demand is reduced to nil and the case reaching finality. From the above it is clear that the attachment of immovable property is a subsequent and distinct action of the Revenue pursuant to drawing of the "certificate". Therefore, the Revenue is vested with a discretionary power to attach the immovable property/properties for recovery of the demand. Now the question arises whether the Revenue can enforce its discretionary power for attaching the immovable property of the assessee when there is no demand as the result of any appellate proceedings. Attachment of an immovable property brings immense hardship to the assessee and restrains the assessee from enjoying the property wholly. In this situation, we are of the considered view that the Revenue cannot exercise its discretionary power to attach the property when there is no demand against the assessee or the demand is meager compared to the value of the immovable properties of the assessee by virtue of any appellate order and when other means of recovery is available to the Revenue. The Hon'ble jurisdictional High Court in the case of Sri Lakshmi Brick Industries(supra) cited by the learned Authorized Representative has also made the ratio of this issue very clear wherein it was held as follows:—
"In the present case, the order of the ITAT, held in favour of the assessee and that order had been given effect to. As a consequence, it was held that, the Tax Recovery Officer was bound to give effect of the order of the CIT (A) who accepted the order of the Tribunal. It was another matter for the department to proceed in appeal and the department was always at liberty to proceed for recovery if they succeed in the appeal before the court. It was held that the provisions of Section 225(2) gives a mandate to Tax Recovery Officer to pass appropriate orders based on the orders passed in appeal or other proceedings. In such view of the matter, the Tax Recovery Officer was directed to pass necessary orders, consequent to the proceedings of the CIT (A), accepting the order of the Tribunal. It was held that taking note of the nil payment insofar by the assessee for all the assessment year, the Tax Recovery Officer has to release the property from attachment in terms of the order of the Tribunal and consequent order of the CIT(A).
The provisions of Section 225(2) gives a mandate to Tax Recovery Officer to pass appropriate orders based on the orders passed in appeal or other proceedings.
Where order of the Tribunal was in favour of the assessee and had been given effect, the Tax Recovery Officer was bound to give effect to the order of the Assistant Commissioner who accepted the order of the Tribunal."
7. Keeping in view of the above mentioned decision of the Hon'ble jurisdictional High Court and the provisions of section 222(1) and 225 (2) & (3) of the Act, it is apparent that the Tax Recovery Officer is bound to amend the "certificate" / or cancel the same when the demand is reduced to nil by virtue of any appellate orders including the order of the Ld.CIT(A) leave apart the order of the Tribunal. In this case, the learned TRO has failed to do so by citing flimsy reasons that the demand subsist for about 15 lacks and thereby withholding the immovable properties of the assessee worth several crores. As on date when there is no demand or the demand is considerably reduced by virtue of the order of the Tribunal, and the order of the Ld.CIT(A) consequently the Revenue is bound to amend the "Certificate" and orders with respect to attachment of immovable properties accordingly. If the order of the Tribunal is not given effect in letter and spirit, there is no purpose for such an order and it will merely amount to waste paper.
8. In this particular case of the assessee, it appears that the Revenue is in the course of intriguing vindictive action by denying the right of the assessee to hold clear title of his immovable property. Before us, the concerned learned Assessing Officer, the learned Commissioner of Income Tax and the learned TRO appeared and expressed their view that the attachment cannot be lifted until the case has reached finality before the Hon'ble Apex Court in favour of the assessee. They also submitted that attachment was lifted with respect to one immovable property and bank account of the assessee. We fail to understand whether attachment of the immovable property and lifting of the same can be done at the whims and fancies of the Revenue. If the attachment cannot be lifted until the final disposal of the case by the Hon'ble Apex Court in favour of the assessee, then the question arises why the attachment was lifted in a particular property. The learned Authorized Representative submitted before us that though the Ld.TRO has lifted the attachment of the property he has not deliberately communicated the same to the concerned Sub-Registrar in order to give complete effect for the lifting of the attachment. We are of the view that this kind of hide and seek attitude of the Revenue is not appreciable which inflicts irreparable loss and harm to the assessee apart from brining disrepute to the Revenue. It is pertinent to mention at this juncture that neither the order of the Tribunal is stayed by the Hon'ble jurisdictional High Court nor an appeal before the Hon'ble High Court is filed by the Revenue for staying of the order of the Tribunal. Moreover, it was pointed out by the learned Authorized Representative that such coercive action is not pursued by the Revenue in other similar cases, but it has been particularly taken against the assessee vindictively. The learned Departmental Representative could also not successfully controvert to these submissions of the learned Authorized Representative.
Considering these facts and circumstances of the case, in the interest of justice, we hereby direct all the appropriate Revenue authorities to pass all the consequential orders relevant to the order passed by the Tribunal and the Ld.CIT(A) for the subsequent assessment year which includes lifting of the attachment of the immovable property as well, when there is no existing demand or the assessee has furnished sufficient security to cover the existing demand by way of Bank Guarantee pursuant to the appellate orders. It is hereby ordered accordingly.
8.1 We also remind the Revenue that not following the orders of the Tribunal will amount to "contempt" and the assessee shall be at liberty to pursue "contempt" proceedings before the Hon'ble jurisdictional High Court. The Ld.A.R has alleged before us that the Revenue is harassing the assessee against the provisions of law and being singled out while applying certain provisions of the Act. On this we are left with no other option but to advise the assessee to bring his grievances to the notice of the concerned Principal Chief Commissioner of Income Tax, Grievance Cell of the Revenue and the learned Members of the Central Board of Direct Taxes for remedial actions and for expediting the same we also direct the Registry to forward a copy of this order to all the Revenue authorities mentioned hereinabove.
9. In the result, the Miscellaneous Petition of the assessee is allowed as indicated herein above.