RAM KUMAR SONI S/O SHRI MANOHAR LAL SONI vs. PRINCIPAL COMMISSIONER OF INCOME TAX (CENTRAL)

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CW/19199/2024HC RajasthanRJHC02107638202405 May 2025Bench: MANINDRA MOHAN SHRIVASTAVA,MUKESH RAJPUROHIT3 pages
AI SummaryRemanded

What did the High Court hold?

The High Court, without commenting on the merits, disposed of the writ petition. It acknowledged that the petition had been pending for approximately six months and that the petitioner had raised a dispute regarding the permissibility of attaching overdraft facility/cash credit, with a liability of Rs. 3 crores. Considering these factors, the Court directed the respondents (revenue authorities) to examine the petitioner's representations and take an appropriate decision in light of Section 226(3)(vii) of the Income Tax Act, 1961, which allows for revocation of attachment in appropriate cases. The respondents were instructed to decide the representations at the earliest, within an outer limit of three weeks from the date of the order.

What were the facts?

The petitioner, Ram Kumar Soni, proprietor of M/s. M.B. & Sons Jewellers, filed a writ petition challenging attachment proceedings initiated by the revenue. The petitioner contended that no notice was issued before the attachment, and had notice been given, he would have informed the authorities about pending petitions challenging an order by the Settlement Commission. He also argued that even if a liability existed, the department should consider alternative steps to attachment, especially given the pendency of court cases and his representations dated 04.12.2024 and 11.12.2024, which remained undecided. The revenue acknowledged the petition's pendency and stated that the authorities would examine the petitioner's representations and revocation prayer if directed by the court.

What were the issues?

1. Whether the attachment proceedings initiated by the revenue are in violation of the statutory scheme under Section 226(3) of the Income Tax Act, 1961, specifically concerning the requirement of issuing notice prior to attachment? Assessee's Contentions: - Notice was not issued before the attachment took place. - Had notice been issued, the petitioner would have brought to the authority's notice the pendency of petitions challenging the Settlement Commission's order. - Even if a liability subsisted, the department should consider alternatives to attaching overdraft facility/cash credit, given the pending court cases. - Representations made on 04.12.2024 and 11.12.2024 have remained undecided, despite the power to revoke attachment under Section 226(3)(vii) of the Act. Revenue's Contentions: - The petition has remained pending without any notice. - If directed, the authorities shall examine the representations of the petitioner and the prayer for revocation in accordance with law within a time-bound period.

Which sections of the Income-tax Act were involved?

Section 226(3),Section 226(3)(vii)

AI-generated summary — verify with the full judgment below

[2025:RJ-JP:18773-DB] HIGH COURT OF JUDICATURE FOR RAJASTHAN BENCH AT JAIPUR D. B. Civil Writ Petition No. 19199/2024 Ram Kumar Soni S/o Shri Manohar Lal Soni, Aged About 63 Years, Sole Proprietor Of M/s. M.B. & Sons Jewellers, having its address at Old Dujod Gate Fatehpur Road, Anand Nagar, Sikar 332001. ----Petitioner Versus 1. Principal Commissioner of Income Tax (Central), Jaipur having its address at 4Th Floor, Jeevan Nidhi II, LIC Building, Bhawani Singh Road, Jaipur. 2. Deputy Commissioner of Income Tax (Central Circle-3), Jaipur having its address at 4Th Floor, Jeevan Nidhi II, LIC Building, Bhawani Singh Road, Jaipur. ----Respondents For Petitioner : Mr. Siddharth Ranka Advocate with Mr. Rohan Chatter Advocate. For Respondents : Mr. Siddharth Bapna Advocate with Mr. Meyhul Miittal Advocate. HON'BLE THE CHIEF JUSTICE MR. MANINDRA MOHAN SHRIVASTAVA HON'BLE MR. JUSTICE MUKESH RAJPUROHIT Order 05/05/2025 1. Heard. 2. Challenge to attachment proceedings is essentially based on alleged violation of statutory scheme engrafted under Section 226(3) of the Income Tax Act, 1961 (hereinafter referred to as ‘the Act’). 3. Learned counsel for the petitioner would submit that notice was not issued and even without notice, attachment took place. He would submit that had a notice been issued, the petitioner (Uploaded on 06/05/2025 at 08:46:40 AM) (Downloaded on 30/10/2026 at 09:39:17 AM)

[2025:RJ-JP:18773-DB] (2 of 3) [CW-19199/2024] would have brought to the notice of the authority that not only the petitioner, but the department both have filed petitions challenging order dated 22.12.2022 passed by the Settlement Commission. Learned counsel for the petitioner would further submit that even assuming that as on the date when the attachment was made, the liability subsisted, the petitioner still has a case to seek indulgence of the department not to take the steps of attachment, but any other steps taking into consideration the pendency of petitions before this Court or such other steps rather than attaching overdraft facility/cash credit. He would submit that the representations, which were made by the petitioner on 04.12.2024 and 11.12.2024, have also remained pending and not decided though there is power to revoke attachment as provided under Clause (vii) of sub-section (3) of Section 226 of the Act. 4. Learned counsel for the respondents would submit that the petition has remained pending without any notice. However, if so directed, the authorities shall examine the representations of the petitioner and prayer for revocation in accordance with law within a time bound period. 5. Without commenting upon the merits of the case at this stage, but taking into consideration that this petition has remained pending for almost six months and further that there is a liability of payment of Rs. 3 crores and the petitioner has raised the issue with regard to permissibility of attachment of overdraft facility/cash credit, we consider it apposite to dispose off this petition at this stage directing the respondents to examine the representations of the petitioner and take appropriate decision in (Uploaded on 06/05/2025 at 08:46:40 AM) (Downloaded on 30/10/2026 at 09:39:17 AM)

[2025:RJ-JP:18773-DB] (3 of 3) [CW-19199/2024] the light of the provisions contained in Section 226(3)(vii) of the Act that in appropriate case, even revocation can also be ordered. 6. At this stage, we are, therefore, inclined to dispose off this petition with direction to the respondents to decide the representations of the petitioner at the earliest and in any case within an outer limit of three weeks from today. 7. Writ petition is, accordingly, disposed off. (MUKESH RAJPUROHIT),J (MANINDRA MOHAN SHRIVASTAVA),CJ MANOJ NARWANI-GARIMA/12 Powered by TCPDF (www.tcpdf.org) (Uploaded on 06/05/2025 at 08:46:40 AM) (Downloaded on 30/10/2026 at 09:39:17 AM)

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