MR.SAMUEL JACOB, vs. THE COMMISSIONER OF INCOME TAX

WP(C)/19334/2022HC KeralaKLHC01039714202215 June 2022Author: HONOURABLE MR. JUSTICE GOPINATH P.3 pages

AI SummaryRemanded

What did the High Court hold?

The High Court of Kerala disposed of the writ petition by directing the 2nd respondent, the Tax Recovery Officer, to consider and pass orders on Ext.P5 (the petitioner's application to lift the attachment) within a period of 2 months from the date of receipt of a certified copy of the judgment. The Court did not decide on the legality of the attachment itself, deferring that to the Tax Recovery Officer's consideration. The ratio decidendi is that procedural remedies should be exhausted and authorities directed to act within a reasonable time when no objection is raised by the respondent.

What were the facts?

The petitioner, Mr. Samuel Jacob, approached the High Court of Kerala aggrieved by the attachment of his personal property by the Income Tax Department. He contended that the attachment was illegal because the liability in question pertained to a company in which he was a Director. The petitioner had filed an application (Ext.P5) before the Tax Recovery Officer (2nd respondent) seeking to lift the attachment on his personal property. The petitioner limited his prayer to a direction for the 2nd respondent to consider and pass orders on Ext.P5 within a specified timeframe. The Standing Counsel for the Income Tax Department had no objection to this course of action.

What were the issues?

1. Whether the attachment of the petitioner's personal property is illegal, considering the liability pertains to a company in which the petitioner was a Director? (Question of law and fact, turning on principles of corporate liability and personal guarantees/liabilities). Assessee's Contention: The attachment of personal property is illegal as the debt is that of a company, not the individual director. The petitioner relies on the principle that directors are generally not personally liable for company debts unless specific provisions are invoked. Revenue's Contention: The revenue did not explicitly argue against the illegality of the attachment in this writ petition. Their counsel had no objection to a direction for the Tax Recovery Officer to consider the petitioner's application.

AI-generated summary — verify with the full judgment below

Heard together (2 matters)

WP(C) NO. 19334 OF 2022

TC 95/15

Read from the judgment's own cause title. This page is filed under one of them.

Cause title — parties, addresses and appearances

IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT THE HONOURABLE MR. JUSTICE GOPINATH P. WEDNESDAY, THE 15TH DAY OF JUNE 2022 / 25TH JYAISHTA, 1944 WP(C) NO. 19334 OF 2022 PETITIONER: MR.SAMUEL JACOB, AGED 31 YEARS, S/O JACOB SAMSON, AGED 31 YEARS, RESIDING AT TC 95/1580(3) NANDANAM, PADINJATTIL LANE, MEDICAL COLLEGE P.O., THIRUVANANTHAPURAM, PIN - 695011 BY ADVS. MANJUNATH MENON S.SREEKUMAR (SR.) P.MARTIN JOSE P.PRIJITH THOMAS P.KURUVILLA R.GITHESH AJAY BEN JOSE SACHIN JACOB AMBAT ANNA LINDA V.J HARIKRISHNAN S. RESPONDENTS: 1 THE COMMISSIONER OF INCOME TAX AAYKAR BHAVAN, 1ST FLOOR, KOWDIAR P.O., THIRUVANANTHAPURAM, PIN - 695003 2 THE TAX RECOVERY OFFICER, AAYKAR BHAVAN, 1ST FLOOR, KOWDIAR P.O., THIRUVANANTHAPURAM, PIN - 695003 3 MR. K.PARAMESWARAN NAIR REG NO. IBBI/IPA-001/IP-P01773/2019-2020/12702) INSOLVENCY RESOLUTION PROFESSIONAL IN CP(IB)/05/KOB/2021 PENDING BEFORE NCLT, KOCHI BENCH RESIDING AT 37/1736 E, KRIPASAGARAM, KMRUALI ROAD, KADAVANTHARA,ERNAKULAM, KERALA, PIN - 682020 BY ADV JOSE JOSEPH, SC, INCOME TAX DEPARTMENT, KERALA THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 15.06.2022, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: W.P (C) No.19334/2022 -2-

J U D G M E N T The petitioner has approached this court being aggrieved by attachment at the instance of Income Tax Department in respect of certain property belonging to him. It is submitted that the said attachment is illegal as the liability in respect of which the attachment is effected is the liability of a company in which the petitioner was a Director. It is submitted that the petitioner has filed Ext.P5 before the 2 nd respondent seeking to lift the attachment over the personal property of the petitioner. The learned counsel for the petitioner limits the relief for a direction to 2nd respondent to consider and pass orders on Ext.P5 within a time frame to be fixed by this court. The learned Standing counsel has no objection to such a course of action. Therefore this writ petition will stand disposed of directing the 2nd respondent to consider and pass orders on Ext.P5 within a period of 2 months from the date of receipt of a certified copy of this judgment. GOPINATH P. JUDGE AMG

W.P (C) No.19334/2022 -3-

Appendix — schedule of exhibits

APPENDIX OF WP(C) 19334/2022 PETITIONER EXHIBITS Exhibit P1 TRUE COPY OF GIFT DEED NO.2333 OF 2009 DATED 29-08- 2009 Exhibit P2 TRUE COPY OF NOTICE DATED 19-05-2022 RECEIVED BY THE PETITIONER FROM THE KESAVADASAPURAM CO-OPERATIVE SOCIETY LTD. Exhibit P3 TRUE COPY OF ENCUMBRANCE CERTIFICATE OF THE PROPERTY COVERED UNDER EXHIBIT.P1 Exhibit P4 TRUE COPY OF ORDER DATED 03-11-2021 IN CP(IB)/ 05/ KOB/2021 OF THE NATIONAL COMPANY LAW TRIBUNAL, KOCHI BENCH Exhibit P5 TRUE COPY OF REPRESENTATION DATED 24-02-2022 PREFERRED BY THE PETITIONER BEFORE THE 2ND RESPONDENT Exhibit P6 TRUE COPY OF EMAIL DATED 09-04-2022 SENT BY THE PETITIONER TO THE 2ND RESPONDENT Exhibit P7 TRUE COPY OF EMAIL DATED 21-04-2022 SENT BY THE PETITIONER TO THE 2ND RESPONDENT Exhibit P8 TRUE COPY OF ORDER DATED 16-03-2022 IN I.A. (IBC).NO.14(KOB) / 2022 IN CP(IB)/ 05/ KOB/2021 OF NATIONAL COMPANY LAW TRIBUNAL, KOCHI BENCH APPOINTING THE 3RD RESPONDENT AS THE INSOLVENCY RESOLUTION PROFESSIONAL

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