Law:

Section:

Section 222, read with Rule 11, of the SCH II of the Income-tax Act, 1961 - Collection and recovery of tax - Certificate proceedings - Assessment year 1959-60 and 1961-62 - Whether under rule 11 of Second Schedule to Act, TRO has power or authority to investigate to come to a finding with regard to a property being in nature of a benami transaction, for purpose of sale by auction of that benami property for recovering outstanding demand of assessee - Held, yes FACTS The TRO had sold an immovable property by auction to recover the income-tax dues of late 'D'. While dealing with the matter, the TRO rejected the objections raised by the writ petitioner, who claimed to be the legal heir of late 'P' to the effect that 'P' was the real owner of the said property and not 'D' and, therefore, the property could not be auctioned for recovery of the outstanding demand of 'D' and passed the order under rule 11(6) of the Second Schedule to the Act on 6-8-2007. He held that the real owner of the property was 'D' and the ostensible owner of the property was a fictitious person named 'P'; and that the said 'D' was enjoying the income from the said property standing in the fictitious name of 'P' wife of 'D', who was actually the creation and benamidar of 'D'. The TRO, thereafter, concluded that the property could be auctioned for recovery of the outstanding demand of 'D'. The petitioner filed writ petition challenging validity of impugned order dated 6-8-2007. He contended that the scope of enquiry under rule 11, which is akin to Order XXI, rule 58 of the Code of Civil Procedure (as it stood prior to 1976 amendment) was very limited in nature and was confined only to a summary investigation as regards possession and the TRO could not decide intricate questions of law as to the title of the property. HELD The contention of the petitioner, that the order of the TRO was passed without jurisdiction since the TRO acting under rule 11 of the Second Schedule to the Act did not have any authority to go into or adjudicate the question of benami, was wholly without basis, since the writ petitioner himself had earlier moved the writ petition being C.O. No. 8094(W) of 1996 which was…

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