Law:

Section:

Section 222, read with Second Schedule, of the Income-tax Act, 1961 - Recovery of tax - Proclamation for sale - First sale of property was adjourned as bid amount fell below reserve price - On next date of auction, notice of auction was given on same date in newspapers - Conditions of first and second sales were materially different -Whether second sale was a fresh sale and absence of sufficient notice of same as per rule 55 of Second Schedule made such sale bad - Held, yes Facts The auction sale on 19-2-1987 of certain property could not take place as the highest bid fell below the reserve price. One of the clauses of the conditions of sale was that the unearned increase which was to be paid to the DDA shall be borne by the purchaser in addition to the bid money. A second auction sale was conducted on 27-2-1987. This sale was advertised in the newspapers of the same date. This time the conditions of sale provided that unearned increase would be paid by the department. The contention of the petitioner was that the sale on 19-2-1987 had been rescinded as it did not fetch the reserve price. According to him the auction of 27-2-1987 was bad for want of sufficient notice as required under rule 55 of the Second Schedule as the advertisement was published only on the date of the proposed auction. According to the petitioner the auction was bad for want of sufficient notice. On writ petition: Held It could not be said that the first sale had been rescinded as it was clear from records that it had been adjourned. However, the sale of 27-2-1987 could not be taken to be a simple adjournment or continuation of the earlier sale because of a vital change in the terms and conditions of the sale. The advertisements which appeared in respect of the sale on 19-2-1987, apparently consistent with the proclamation of sale drawn up under rule 52(2) of the Second Schedule, specifically mentioned that the share of unearned increase will have to be paid by the purchaser. This condition, however, was replaced in the second advertisement by an announcement that the Income-tax Department would meet this obligation. So far as intending purchasers were concerned, there was a world of…

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