NARESH B. CHHEDA (HUF) vs. JOINT COMMISSIONER OF INCOME TAX, 17 MUMBAI AND ANR.

JUDGMENT (Per Shri R.M.Savant, J.) 1 Rule. With the consent of the parties made returnable forthwith and heard. 2 By the above petition filed under Article 226 of the Constitution CNR No : HCBM020177322010 Uploaded on - 21/08/2020 Downloaded on - 28/10/2026 05:02:20

2 Writ Petition No.1605 of 2010 of India, the Petitioner which is a Hindu Undivided Family challenges the debit of Rs.63,59,240/­ from the account of the Petitioner for the liability of Naresh B. Chheda who is the Karta of the Hindu Undivided Family. The Petitioner also prays that the Respondent No.1 be directed to re­credit the said amount in the account of the Petitioner. 2 Shorn of unnecessary details, the facts necessary to be cited for adjudication of the above Petition can be stated thus: As   stated   hereinabove,   the   Petitioner   is   a   Hindu   Undivided Family (HUF for short), consisting of one Naresh Chheda as its Karta, his wife Nandita Chheda, son Master Pranav Naresh Chheda and daughter Rujuwalika Naresh Chheda, as an independent legal entity, the Petitioner has a Permanent Account Number  and is assessed to Income Tax. 3 The   Karta   of   the   Petitioner   Naresh   Chheda   in  his  individual capacity and under his PAN   number filed his Income Tax Return for the Assessment Year 2007­2008 with the Department. In respect of the said return, an assessment order dated 29­12­2009 came to be passed under the signature of the Respondent No.1 herein and by the said assessment order, an addition of Rs.1,49,01,030.00 was made and the said Naresh Chheda was directed to pay further Tax. A notice of demand under Section 156 of the Income Tax Act, 1961 (for short the said Act) was issued calling upon the said Naresh Chheda Uploaded on - 21/08/2020 Downloaded on - 28/10/2026 05:02:20

3 Writ Petition No.1605 of 2010 to pay further tax of Rs.63,59,240/­. The said Naresh Chheda filed an Appeal under Section 246(A) before the Commissioner of Income Tax (Appeals)­29, challenging the said order dated 29­12­2009. The said Naresh Chheda, by a letter dated 20­1­2010, addressed to the Respondent No.1 requested that the demand of tax be kept in abeyance in terms of Section 220(6) of the said Act, till the Appeal is finally disposed of. Thereafter, a demand notice under Section 226(C) of the said Act came to be issued to the Respondent No.2 Bank by the Respondent  No.1  to  forthwith  pay  to  the  Respondent No.1  a  sum  of  Rs. 63,59,240/­   from   the   account   of   the   said   Naresh   Chheda,   being   Saving Account No.623701063436. Simultaneously, the Respondent No.1 also issued the demand notice to the Respondent No.2 directing the Respondent No.2 to forthwith   debit   the   account   of   the   Petitioner   HUF   being   account   No. 623705016782   for   a   sum   of   Rs.63,59,240/­   and   pay   the   same   to     the Respondent No.

4 Writ Petition No.1605 of 2010 The   Respondent   No.2,   it   seems,   along   with   its   reply,   also   enclosed   a communication   dated   5­3­2010   addressed   by   the   Respondent   No.1   to Respondent No.2 withdrawing its purported demand notice dated 5­3­2010, concerning   the   Petitioners   account.   The   Petitioner   thereafter,   issued   its Chartered Accountant’s letter dated 31­5­2010, addressed to the Respondent No.1,  requesting   to   refund   /   return   the   amount   of   Rs.63,59,240/­   which according to it, was wrongly debited from the account of the Petitioner. The Respondent No.1 in turn, addressed a communication dated 7­6­2010 to the said Naresh Chheda in his individual capacity, contending that the account of the Petitioner, which has been debited, stands jointly in the names of the Petitioner as well as the said Naresh Chheda. As indicated above, aggrieved by the fact that the Petitioner’s account has been debited for the liability of the said Naresh Chheda in his individual capacity that the Petitioner has invoked the writ juri iction of this Court. 4 We have heard the Learned Senior Counsel Mr. Pardiwala for the Petitioner and the Learned Counsel Shri Vimal Gupta for the Respondent No.

5 Writ Petition No.1605 of 2010 We are also informed at the bar that the daughter is a minor. The said   Naresh   Chheda   a   constituent   of   the   HUF   would,   therefore,   have   an undivided share in the amount lying in the bank account of the HUF. The Respondent No.1, therefore, would not be entitled to attach and appropriate entire amount which was in the account of the HUF for the liabilities of the said Naresh Chheda as an individual, it can only attach and appropriate the amount in credit in the bank account of the HUF only to the extent falling to the share of the said Naresh Chheda. The said legal position was also not disputed by the Learned Counsel appearing for the parties. The Learned Senior Counsel for the Petitioner, Shri Pardiwala, during   the   course   of   the   hearing   of   the   above   Petition,   upon   taking instructions, agreed to intimate the amount falling to the share of the said Naresh Chheda in the bank account of the HUF, so that the  amount excluding the amount  falling to the share of Naresh Chheda, could be returned by the Income Tax Department to the Bank so as to credit the same in the HUF account   from   which   the   amount   was   withdrawn   by   the   Income   Tax Department. The Learned Senior Counsel fairly submitted that the same would be done by the Petitioner within the time that will be stipulated by this Court. 6 In our view, considering the fact that the tax liability was that of Naresh Chheda  in his individual capacity, the action of the Respondent No.1 claiming the amount from the account of the HUF with Respondent No.2 to the Uploaded on - 21/08/2020 Downloaded on - 28/10/2026 05:02:20

6 Writ Petition No.1605 of 2010 extent   it   does   not   fall   to   the   share   of   Naresh   Chheda   in   the   HUF,   is unsustainable, is required to be set aside. 7 On   the   Petitioner’s   intimating   the   share   of   the   said   Naresh Chheda in the said account No.623705016782 of the HUF to the Respondent No.1   by   30­10­2010,   the   Respondent   No.1   shall   redeposit   the   amount, excluding the share of Naresh B. Chheda within two weeks of the intimation by the Petitioner failing which the amount shall carry interest @ 12% per annum till the payment in full and final. The said debited amount coming to the share of Naresh Chheda would lie with the Respondent No.1, subject to the result of the Appeal filed by Naresh Chheda and the orders that may be passed in further proceedings that may be adopted by the parties.

8 Rule is accordingly made absolute in the aforesaid terms with parties to bear their respective costs. (R.M.SAVANT,J.) (V.C.DAGA,J.) Uploaded on - 21/08/2020 Downloaded on - 28/10/2026 05:02:20 Powered by TCPDF (www.tcpdf.org)