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1980 Supreme(Bom) 260
IN THE HIGH COURT OF BOMBAY
(A. A. Ginwala and D. B. Deshpande JJ.)
GHANSHYAMDAS GOPALDAS MOHTA and another L. Rs. of Gopaldas Mohta Petitioners.
vs.
UNION OF INDIA and others Respondents.
Spl. C. A. No. 940 of 1974
Decided on 12-11-1980. (Nagpur)
Advocate Appeared
For petitioners-R. S. Pandit and R. S. Tajpuriya.
For respondents Nos. 1 to 3-R. G. Deshpande.
For respondent No.7-B. R. Mand/ekar.
Section 5 of the Limitation Act, 1963, is applicable to appeals filed under rule 86 of the Second Schedule of the Income Tax Act, 1961, by virtue of section 29(2) of the Limitation Act, which provides that the provisions of sections 4 to 24 of the Act shall apply to all cases where a period of limitation has been laid down under a local or special law, unless such provisions are expressly excluded by the local or special law.
Headnote:
INCOME TAX - Limitation Act, 1963 - Section 5 - Applicability to appeals under rule 86 of the Second Schedule of the Income Tax Act, 1961 - Whether section 5 of the Limitation Act applies to appeals filed under rule 86 of the Second Schedule of the Income Tax Act, 1961.
Fact of the Case:
The petitioner, Gopaldas Mohta, filed an appeal under rule 86 of the Second Schedule of the Income Tax Act, 1961, challenging the sale of his property by the Tax Recovery Officer for the recovery of tax dues. The Tax Recovery Commissioner dismissed the appeal as barred by limitation, holding that he had no power to condone the delay in filing the appeal since section 5 of the Limitation Act, 1963, which empowers courts to condone delay, did not apply to proceedings before him.
Finding of the Court:
The court held that section 5 of the Limitation Act, 1963, is applicable to appeals filed under rule 86 of the Second Schedule of the Income Tax Act, 1961, by virtue of section 29(2) of the Limitation Act, which provides that the provisions of sections 4 to 24 of the Act shall apply to all cases where a period of limitation has been laid down under a local or special law, unless such provisions are expressly excluded by the local or special law.
Issues: Whether section 5 of the Limitation Act, 1963, applies to appeals filed under rule 86 of the Second Schedule of the Income Tax Act, 1961.
Ratio Decidendi: The court relied on the provisions of section 29(2) of the Limitation Act, 1963, which provides that the provisions of sections 4 to 24 of the Act shall apply to all cases where a period of limitation has been laid down under a local or special law, unless such provisions are expressly excluded by the local or special law. The court held that the Income Tax Act, 1961, or the rules contained in Schedule II thereof did not expressly exclude the application of section 5 of the Limitation Act, and therefore, section 5 was applicable to appeals filed under rule 86 of the Second Schedule.
Final Decision: The court allowed the writ petition, quashed the order of the Tax Recovery Commissioner dismissing the appeal as barred by limitation, and directed the Commissioner to consider and dispose of the application for condonation of delay on its merits.
GINWALA J.- The only point which arises for our consideration in this writ petition is whether the appeals filed under rule 86 of the Second Schedule of the Income Tax Act, 1961 are governed by the provisions of section 5 of the Limitation Act, 1963 (hereinafter referred to as the Limitation Act). The facts relevant for the purposes of question under consideration may briefly be stated.
2. It appears that the Income Tax Officer had forwarded to the Tax Recovery Officer a certificate under the provisions of section 222 of the Income Tax Act in the year 1964 for recovering an amount of Rs. 10,370.45 from the original petitioner, namely, Gopaldas Bulakhidas Mohta. After adjustments from time to time the demand came to be reduced to Rs. 4365 in the year 1972. In order to recover this amount, the Tax Recovery Officer, who is respondent No.2 herein, attached two pieces of agricultural lands bearing survey No. 14 admeasuring 4 acres 31 gunthas and survey No. 18/1 admeasuring 1 acre 5 gunthas, both situated at Tajnapur. On 22-6-1972 the said Officer issued a proclamation of sale under rule 38 of the said Rules read with rule 52 (2) declaring that those two lands would be sold by public auction at 1.00 p. m. on 13-7-1972. In pursuance of this proclamation the sale was held on 13- 7-1972 and survey No. 14 was knocked down for Rs.75,500 and survey No. 18/1 for Rs. 15,500. The up set price for these two lands had been fixed at Rs. 75.000 and Rs. 15,000 respectively.
On 10-8-1972 Gopaldas Mohta filed an application before the Tax Recovery Officer purporting to be under rule 61 read with rule 87 of the said Rules. In this application he contended that the sale held on ]3-7-1972 was bad, firstly because it was held within 30 days from the date of proclamation and as such in contravention of the provision contained in rule 55 of the Second Schedule and secondly that a much larger property had been put to sale for recovering a meagre amount of Rs. 4365. It was contended that material irregularities had been committed in the conduct of sale which had resulted in loss to the petitioner. It appears that besides Gopaldas Mohta, three ladies had also filed an application on ]4·8-1972 under the said rules for setting aside the said sale on the ground that they were equitable mortgagees of the land bearing survey No. ]4 and that the proclamation was silent with respect to their said right. Besides this, they also challenged the sale on the same two grounds, on which Gopaldas Mohta had done it under his application stated above. When the application of Gopaldas Mohta was pending before the Tax Recovery Officer, Gopaldas Mohta had filed two more applications on 7-9-1972 one for review of the order for sale and second for permitting him to sell the lands privately. Proviso (b) to rule 6] provides that an application made by a defaulter under that rule shall be disallowed unless the applicant deposits the amount recoverable from him in execution of the certificate. It appears that because of the requirement of this proviso, Gopaldas Mohta made an application for permission to deposit the amount due from him on 20-9·1972. It is alleged that the Tax Recovery Officer issued the requisite challan to him on 20-9-1972 and he deposited the amount on 30-9-1972. However, in the meanwhile the Tax Recovery Officer on 29-9-1972 passed his order on the application filed by Gopaldas Mohta on 10-8-1972 for setting aside the sale. The Tax Recovery Officer rejected the application holding that Gopaldas Mohta had not fulfilled the requisite conditions laid down in rule 61 for setting aside the sale, namely. (a) that he had not proved any substantial injury by reason of irregularity, and (b) that he had not deposited the amount recoverable from him in execution of the certificate. He also dismissed the application for review. On the same day the Tax Recovery Officer proceeded to confirm the sale in favour of respondent No.4, who was the auction purchaser. While pa
