PUNJAB NATIONAL BANK vs. THE CENTRAL BOARD OF DIRECT TAXES

WP(C)/7840/2013HC KeralaKLHC01051037201301 October 2014Bench: HONOURABLE MR.JUSTICE A.M.SHAFFIQUE3 pages

AI SummaryDismissed

What did the High Court hold?

The High Court of Kerala found that the writ petition had become infructuous. This was based on the submission by both the petitioner bank and the respondents (Income Tax Department) that the department had passed on the amount due to the bank. Therefore, the Court did not delve into the merits of the claim regarding the first charge. The operative direction was to dismiss the writ petition as infructuous. No specific issue was decided on merits, and no ratio decidendi for future cases on the priority of charges was established.

What were the facts?

The petitioner, Punjab National Bank, filed a writ petition seeking a declaration that its right to recover income tax dues had a first charge over a property. The property in question had been attached and sold by the Income Tax Department. The parties informed the Court that the Income Tax Department had subsequently passed on the amount due to the bank. Consequently, the writ petition was rendered infructuous.

What were the issues?

1. Whether the right to recover income tax dues by the Income Tax Department is subject to the first charge of the petitioner bank over the property in question. Assessee's Contention: The petitioner bank argued that its right to recover its dues had priority as a first charge over the property. Revenue's Contention: The judgment does not record any specific contentions made by the Income Tax Department or the Central Board of Direct Taxes regarding the priority of charges. However, their involvement in attaching and selling the property implies a claim over it.

AI-generated summary — verify with the full judgment below

IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT: THE HONOURABLE MR.JUSTICE A.M.SHAFFIQUE WEDNESDAY, THE 1ST DAY OF OCTOBER 2014/9TH ASWINA, 1936 WP(C).No. 7840 of 2013 (D) --------------------------- PETITIONER : ---------------------- PUNJAB NATIONAL BANK, REPRESENTED BY CHIEF MANAGER/AUTHORISED OFFICER, K.BHARATHY, CHAMBAKKADA BRANCH, CHAMBAKADA, KOLLAM DISTRICT, PIN-CIRCLE OFFICE, MARKET ROAD, ERNAKULAM -682 011. BY ADVS.SRI.R.PARTHASARATHY SMT.SEEMA RESPONDENT(S): ---------------------------- 1. THE CENTRAL BOARD OF DIRECT TAXES WITH ADDRESS FOR SERVICE THE CHAIRMAN, CENTRAL BOARD OF DIRECT TAXES, NORTH BLOCK, NEW DELHI -110 001. 2. THE TAX RECOVERY OFFICER,INCOME TAX DEPARTMENT, RANGE-1, TRIVANDRUM-695 001. 3. N.ROYMOL,W/O.LATE JAYARAJAN, MOOTHEDATHU VEEDU, THATTAMALA P.O., KOLLAM, PIN -691 020. 4. RAMMY,D/O.LATE JAYARAJAN, MOOTHEDATHU VEEDU, THATTAMALA P.O., KOLLAM, PIN- 691 020. 5. REEMA,D/O.LATE JAYARAJAN, MOOTHEDATHU VEEDU, THATTAMALA P.O., KOLLAM, PIN -691 020. R1 & R2 BY SR.COUNSEL SRI.P.K.R.MENON, (TAXES) SRI.JOSE JOSEPH, SC THIS WRIT PETITION (CIVIL) HAVING BEEN FINALLY HEARD ON 01-10-2014, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: sts

A.M.SHAFFIQUE, J * * * * * * * * * * * * * W.P.C.No.7840 of 2013 --------------------------------- Dated this the 1st day of October 2014

J U D G M E N T This writ petition is filed seeking a declaration that the right to recover income tax dues by the Income Tax Department is subject to the first charge of the petitioner bank. The property involved has been attached and sold by the Income Tax Department and it is now submitted by the learned counsel appearing for either side that the department had passed on the amount due to the bank. In that view of the matter, this writ petition has become infructuous and accordingly the same is dismissed as infructuous. (A.M.SHAFFIQUE, JUDGE) jsr

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