EDYATE NEDUMPURATH CHANDRIKA, vs. THE ASSISTANT COMMISSIONER OF INCOME TAX,
What did the High Court hold?
The High Court observed that since the petitioner had deposited 20% of the demand, there would be an automatic stay of recovery. Furthermore, the respondents' counsel conceded that the attachment orders were not surviving as their validity of sixty days from the date of assessment orders had expired. Consequently, the Court found that nothing survived in the writ petition. It was explicitly stated that no order of attachment was surviving in respect of the petitioner's properties, including bank deposits, pursuant to the impugned orders. The writ petition was disposed of with these observations.
What were the facts?
The petitioner, Edyate Nedumpurath Chandrika, filed a writ petition challenging garnishee proceedings initiated against her under Section 226(3) of the Income Tax Act, 1961. These proceedings were initiated because the petitioner did not immediately pay the assessed tax amount after the completion of assessment orders. The petitioner had filed appeals against these assessment orders and had also remitted 20% of the assessed tax. The appeals were pending consideration. The petitioner contended that by depositing 20% of the disputed demand, she had complied with the guidelines prescribed in an Office Memorandum dated 31.7.2017, which should result in an automatic stay of further demand. The respondents' counsel submitted that the attachment orders were not surviving in any event, as they were valid only for sixty days from the date of the assessment orders, and this period had expired.
What were the issues?
1. Whether the garnishee proceedings initiated against the petitioner under Section 226(3) of the Income Tax Act, 1961, are valid when the petitioner has filed appeals against the assessment orders and remitted 20% of the disputed demand, thereby entitling her to an automatic stay of further recovery as per the Office Memorandum dated 31.7.2017? Assessee's Contention: The petitioner argued that by depositing 20% of the assessed tax, she had complied with the guidelines of the Office Memorandum dated 31.7.2017, which mandates an automatic stay of further recovery proceedings. Therefore, the garnishee proceedings should not have been initiated or should be quashed. Revenue's Contention: The respondents submitted that the attachment orders were not surviving in any event because their validity was limited to sixty days from the date of the assessment orders, and this period had already expired.
Which sections of the Income-tax Act were involved?
AI-generated summary — verify with the full judgment below
Cause title — parties, addresses and appearances
J U D G M E N T The present writ petition has been filed impugning the garnishee proceedings initiated against the petitioner vide Exts.P29 to P32 orders under Section 226(3) of the Income Tax Act, 1961. 2. Since the petitioner did not pay the assessed tax amount immediately after completion of the assessment orders, garnishee proceedings have been undertaken against her. The petitioner has filed appeals against the assessment orders and has also remitted 20% of the tax assessed. The appeals are still pending for consideration and since the petitioner has complied with the guidelines prescribed in Office Memorandum F.No.404/72/93- ITCC, dated 31.7.2017 by making deposit of 20% of the disputed demand, there is automatic stay of further demand in pursuance to the assessment orders.
In view thereof, there is no reason to keep the attachment on the property because once
WP(C) NO. 37729 OF 2022 4 the petitioner has deposited 20% of the demand, there will be automatic stay of recovery.
Sri.Navaneeth N.Nath, learned Standing Counsel appearing for the respondents, submits that the attachment orders are, even otherwise, not surviving, in view of the fact that the attachment orders are valid only for sixty (60) days from the date of the assessment orders and the period of sixty (60) days was over much before.
In view thereof, nothing survives in the present writ petition. It is made clear that there is no order of attachment surviving in respect of the properties of the petitioner, including the bank deposits, if any, in pursuance to Exts.P29 to P32 orders. With the aforesaid observations, the present writ petition is disposed of. Pending interlocutory application, if any, in the present writ petition stands dismissed. DINESH KUMAR SINGH
JUDGE jg
WP(C) NO. 37729 OF 2022 5
Appendix — schedule of exhibits
More judgments on Section 226(3)
- Thoti Sankaraiah, Chittoor vs Income Tax Officer, Ward-1, ChittoorITA 2094/HYD/2026[2016-17]Status: Disposed16 Oct 2026AY 2016-17
- DCIT, Central Circle-1(1), Hyderabad vs Giridhari Homes Private Limited, HyderabadITA 92/HYD/2026[2018-19]Status: Disposed25 Sept 2026AY 2018-19
- DCIT, Central Circle-1(1), Hyderabad vs Giridhari Homes Private Limited, HyderabadITA 91/HYD/2026[2017-18]Status: Disposed25 Sept 2026AY 2017-18
- Giridhari Homes Private Limited… vs ACIT, Central Circle-1(1), HyderabadITA 2066/HYD/2026[2019-20]Status: Disposed25 Sept 2026AY 2019-20
- Giridhari Homes Private Limited… vs ACIT, Central Circle-1(1), HyderabadITA 2065/HYD/2026[2018-19]Status: Disposed25 Sept 2026AY 2018-19
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