Law:

Section:

Section 226 of the Income-tax Act, 1961 - Collection and recovery of tax - Other modes of recovery - Respondent No. 6 (wife of respondent no. 5) created an equitable mortgage in favour of petitioner-bank by deposit of title deeds of immovable property belonging to her - Subsequently, petitioner-bank succeeded in a suit against respondents no. 5 and 6 for realisation of dues by sale of aforesaid property - In meanwhile, income-tax authorities (TRO) issued a letter to petitioner-bank stating that a huge demand of income-tax was outstanding against respondent no. 5, and therefore, property in question was attached as per Income-tax Certificate Proceedings Rules and was put up for auction - Whether since TRO had not brought on record any evidence to show that respondent No. 6 was benamidar of respondent No. 5, it was to be held that property in question in fact belonged to respondent No. 6, and therefore, income-tax authorities could not attach same for recovery of income-tax dues of respondent no. 5 - Held, yes - Whether, since petitioner bank had obtained decree against respondent No. 6, they could recovery their dues by sale of property in question belonging to respondent no. 6 - Held, yes FACTS Respondents Nos. 5 and 6 were indebted to the petitioner-bank in respect of certain accounts opened by them in the petitioner-bank. Since respondent No. 6 had created an equitable mortgage in favour of the petitioner bank by deposit of title deeds of immovable property belonging to her, the bank succeeded in a suit against respondents Nos. 5 and 6 for realisation of the bank's dues by sale of that property. Thereupon, the petitioner filed an application of execution of the final decree. In the meanwhile the respondent no. 4 (TRO) addressed a letter to the petitioner-bank stating therein that a huge demand of income-tax was outstanding against respondent No. 5 and, therefore, the property in question was attached as per Income-tax Certificate Proceedings Rules and that the sale proclamation of the said property had been drawn up and an auction sale had been fixed. The petitioner-bank was, therefore, asked by the income-tax authorities to lodge its claim, if any, with…

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