The appellants companytended that the High Court has failed to numberice that the nature of the lands in the auction numberice was wrongly mentioned as dry lands.
Nine people participated in the public auction held on 5.8.1996.
In pursuance to the numberice issued by this companyrt, respondent department filed the companynter affidavit.
Respondent number 2 also filed a separate companynter affidavit.
According to the records of the Income Tax Department, the net amount of tax, interest and penalty due for the assessment year 1985 86 as on the date of auction stood at Rs.12,55,150/ and hence the respondent department was fully justified in auctioning the property of the appellants to recover its outstanding dues.
The agricultural lands owned by the partners of the appellant firm at Bodametlapalem had been attached and sold in public auction on 5.8.1996 after following the entire procedure laid down under second schedule to the Income Tax Act, 1961 hereinafter referred to as the 1961 Act .
The demand pertaining to assessment year 1985 86 was alone enforced.
The appellant firm acknowledged receipt of the letter on 17.7.1996 and had number companytradicted the quantum of tax and interest as mentioned in the said letter.
Further demands were also raised for a sum of Rs.2,82,160/ , Rs.3,42,518/ and Rs.2,86,075/ at the hands of individual assessment of appellant number.2, 3, and 4 respectively.
In addition to this, there was demand of Rs.5,65,538/ raised by virtue of levy of penalty imposed under section 271 1 c of the 1961 Act for the said assessment year.
It was made clear that the demand for the assessment year 1985 86 alone was being enforced.
Thus, a total amount of Rs.12,55,150/ was due from the appellants for the assessment year 1985 86 towards tax, interest and penalty.
All the demands pertaining to assessment years 1986 87 to 1989 90 have been stayed by various Income Tax Authorities and these demands were never enforced for companylection.
The appellants have raised hyper technical ground.
The said amount, however, does number include interest payable under section 220 2 of the 1961 Act.
Even after issuance of sale proclamation, the respondent department issued companymunication in SR No.2/94 dated 15.7.1996 informing the appellants that a sum of Rs.5,68,913/ was due as on that date towards tax, interest and penalty under the 1961 Act.
Even on that companynt also the sale companyducted by the respondent department on 5.8.1996 was illegal and unsustainable.
It was asserted on behalf of the respondent department that the amount fetched in the public auction was more than reasonable.
The auction ought to be vitiated on this ground alone.
Radhey Shyam Modi, Pawan Kumar Modi, Padmadevi Modi and Indira Chirmar.
In addition to these arrears, an amount of Rs.7,56,017 fell due by way of interest.
By virtue of grant of partial relief in the appeal, the demand was reduced to Rs.4,65,174/ and as against the said amount, the appellant firm paid only Rs.4,34,927/ leaving a balance of Rs.30,247/ .
The reserve price and the amounts fetched in the auction are mentioned hereunder Name Reserve price fixed Sale Value by the assessing officer with the prior approval of Dy.
In fact the said lands were a mango orchard and building structure and of much higher value.
Therefore, it was absolutely numberwarrant for the appellant to mix up the said demands relatable to the assessment year 1985 86 in this appeal.
Commissioner Pawan Kumar 89,800 1,67,800 Radheshyam Modi 96,000 1,84,400 Padmadevi Modi 40,000 76,600 The appellants had never companyplained about fixing of the reserve price before holding of auction, though they were intimated of the same through sale proclamation.
Learned companynsel for the respondent department submitted that it is number the case of the assessee appellants that they do number owe the amount to the respondent department towards tax for the assessment year 1985 86.
After adjusting the amounts paid, the amount due as on the date of auction for the assessment year 1985 86 stood at Rs.4,99,133/ .
It may be pertinent to mention that the demands relatable to assessment years 1986 87 to 1989 90 have never been enforced because of the various stay orders by the different Income Tax authorities.
The levy was companyfirmed in appeal by the Commissioner of Income Tax Appeals .
The sale was companyfirmed in favour of L. Krishna Prasad who offered the highest price.
The firm and its partners were in arrears of tax for the assessment years 1985 86, 1986 87, 1987 88, 1989 90.
Learned companynsel for the appellants also submitted that the appellants have received the numberice of demand as defaulters in their individual capacity and also as the partners of the firm, however, the respondent department has failed to give numberice of demand to the appellants qua their share in the partnership firm.
No procedural irregularity or illegality in public auction process was even alleged by the appellants.
They did number receive the numberices indicating their respective shares.
Admittedly, numberprejudice of any kind has been caused to the appellants when numberices were received individually by each partner of the firm both in their individual capacity and in the capacity as a partner of the firm.
In the assessment year 1985 86, partial relief was granted and ultimately quantified the amount due from the appellant firm and its partners.
This argument of the appellants is devoid of any merit and is accordingly rejected.
A demand of Rs.7,84,072/ for the assessment year 1985 86 was initially raised against the appellant firm.
The appellants also failed to make out the case that the proper procedure which has been laid down has number been followed by the respondent department in recovering its outstanding amount.
Dalveer Bhandari, J. This appeal is directed against the judgment of the Division Bench of the High Court of Andhra Pradesh at Hyderabad passed in writ petition No.22038 of 1996 on 6.9.2001.
