KAPADIA S.H., J.:---By this petition, Stock Exchange Mumbai seeks to challenge notice under section 226(3) of the Income Tax Act dated 5th October, 1995 as also a prohibitory order dated 10th May, 1996 under section 222 of the Income Tax Act served on the petitioner whereby the Stock Exchange is restrained from making any payment of the debt due to Suresh D. Shah, Member-Broker on the Bombay Stock Exchange (BSE) on the ground that the said Broker had failed to pay arrears of income-tax amounting to Rs. 37,48,651.00. In other words, Bombay Stock Exchange is the Garnishee who is prohibited from making payment of the debt to the assessee in default Suresh D. Shah. Under the said prohibitory order dated 10th May, 1996, Stock Exchange Membership Card allotted to the broker for doing business and his accounts in the books of BSE were attached/frozen. Being aggrieved by the aforestated two orders, the Stock Exchange has filed this petition.

FACTS :

2. Petitioner is a Stock Exchange recognized by the Central Government under Securities Contracts (Regulation) Act, 1956 and constituted with the main object of protecting, in public interest, the status of brokers, dealers and investors and in order to assist, regulate and control, in public interest, dealings in securities in order to ensure fair dealing, integrity and to protect equitable principles of trade and business. Respondent No. 1 is the AO having jurisdiction over income tax assessment of the broker who was a Member of Stock Exchange upto 29th June, 1994, when he was declared a "defaulter" under the Rules. Suresh D. Shah was declared insolvent on 4th November, 1997. Respondent No. 5 is the Official Assignee of the estate and effects of the Broker. Respondent No. 2 is the TRO who has issued the abovementioned prohibitory order dated 10th May 1996, which is impugned in this petition. This prohibitory order has been issued pursuant to certificates forwarded to the Broker under section 222 of the Income tax Act. The said Broker failed to pay arrears of income tax due from him under certificate dated 29th March, 1996, amounting to Rs. 37,48,651.00/-. Since the Broker had failed to meet his obligations and discharge his liabilities, the Governing Board of the Stock Exchange declared Suresh Shah a defaulter at a meeting held on 29th June, 1994. On 28th December, 1994, Suresh Shah made an application for re-admission as a Member. Alongwith his application, he forwarded to the Stock Exchange, a Demand Draft for Rs. 30 lakhs towards his dues to the Stock Exchange, dues to the clearing house, dues to his clients and dues in respect of arbitration allowance. The petition was filed around 24th December, 1996. Apart from the Demand Draft of Rs. 30 lakhs, on the date when Suresh Shah was declared a defaulter, a sum of Rs. 1,41,241.00 was lying in the petitioner's defaulters' Committee account. It may be noted that investigations were carried out by the defaulters Committee of the Stock Exchange, both in respect of the conduct of the Broker and his application for re-admission and during the interregnum, out of Rs. 30 lakhs, Rs. 9,93,594.00 were appropriated towards Broker's liability for Vallan and general charges and a sum of Rs. 18,65,165.00/- was paid to Members on account of arbitration allowance obtained by them against the Broker. On the date of the filing of the petition, therefore, Rs. 1,41,241.00/- remained to be appropriated against dues on account of Arbitration Awards obtained by Members, claim of Members pending in arbitration, Arbitration Awards obtained by the clients of the said Broker and claims of the clients pending in arbitration. In short, as against Rs. 1,41,241.00 and securities valued at Rs. 95,435.00/-, lying with the Stock Exchange, Arbitration Awards to the extent of Rs. 67,93,000.00/- remained to be discharged. This was apart from claims pending in arbitration, amounting to Rs. 11,41,575.00/- as on 19th December, 1996.

By letter dated 5th October, 1995, the A