Law:

Section:

Section 222, read with Schedule II, of the Income-tax Act, 1961 - Collection and recovery of tax - Certificate proceedings - Respondent No. 1, i.e., tax department, attached a plot belonging to one 'G' as he owned certain dues to it - Subsequently, for recovery of tax arrears, an open auction of said plot was announced by tax department - Petitioner purchased said plot in auction and sale certificate in respect of that plot was also issued - Respondent No. 2, i.e., DDA, however, refused to register said sale certificate as it had demand for unearned increase on said plot in accordance with clause as contained in sub-lease deed of said plot - Petitioner's case was that it was tax department which was liable to pay unearned increase to DDA - Accordingly, it filed instant writ petition seeking declaration that petitioner was sole and complete owner of said plot which was free from all encumbrances - From records, it was apparent that auction notice issued by tax department nowhere mentioned that there was any liability on purchaser to pay unearned increase - Even as per terms of sub-lease deed of said property, it was sub-lessee who was liable to pay unearned increase and not purchaser - Whether since tax department by attaching plot in question had stepped into shoes of sub-lessee, in view of terms of sub-lease deed liability to pay unearned increase was of tax authorities and certainly not of auction purchaser/petitioner - Held, yes - Whether, therefore, instant writ petition was to be allowed - Held, yes FACTS The President of India through respondent No. 2, i.e., DDA, executed a perpetual sub-lease deed in favour of one 'G'. Clause II(7) of said lease deed provided that the respondent No. 2 had the right to recover unearned increase of 50 per cent even in case of involuntary sale or transfer of property whether it be by or through an executing or insolvency Court. As 'G' owned its dues to the respondent No. 1, i.e., Tax Department (Commissioner), the property was attached by the said respondent and for recovery of income-tax arrears, an open auction was announced for said plot. The petitioner was the highest bidder in said auction, thus, the sale was confirmed…

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