EDELWEISS ASSET RECONSTRUCTION COMPANY LIMITED V. DEPUTY COMMISSIONER OF INCOME TAX

WP/5004/2021

AI Insights

The case involves Edelweiss Asset Reconstruction Company Limited, which filed a writ petition against various income tax authorities and other respondents, seeking two main reliefs: (a) to direct the respondents to furnish copies of documents considered for issuing an attachment order dated 6.8.2019, and (b) to quash the said attachment order and remove encumbrances on shares pledged to the petitioner. The respondents contended that the attachment order was provisional and had ceased to be significant post the assessment order. They also argued that the documents requested were subject to privacy concerns, as they pertained to another assessee. The court, after considering the arguments, decided not to quash the attachment order but allowed the petitioner to seek documents, emphasizing the need for a timely response from the respondents.

• Counselvise Citation: [2021] 140 COUNSELVISE.COM (IT) 763111 (HC-KARNATAKA)
• Appeal Type: Others
• Pronouncement Date: 31-07-2021
• Assessment Year: misc
• Laws Referred To: Articles 226 & 227 of the Constitution of India, Income Tax Act, 1961
• Result in Favour of: Partly Allowed
• Court: HIGH COURT
• Department Lawyers: K V ARAVIND
• Assessee Lawyers: LAKSHMI MENON
• Keywords: Attachment Order; Document Furnishment; Provisional order; Writ petition; Privacy Issues
• Section: 226; 227

Judgement Text

" 1 IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 31ST DAY OF JULY, 2021 BEFORE THE HON’BLE MR. JUSTICE KRISHNA S.DIXIT WRIT PETITION NO.5004 OF 2021 (T-IT) BETWEEN: EDELWEISS ASSET RECONSTRUCTION COMPANY LIMITED EDELWIESS HOUSE, WINDSOR LN, KOLIVERY VILLAGE, MMRDA AREA, KALINA, BANDRA EAST, MUMBAI,V MAHARASHTRA 400098 REPRESENTED BY MS. ASLISHA BATHEJA DESIGNATION; LAW ASSOCIATE. …PETITIONER (BY SMT. LAKSHMI MENON, ADVOCATE) AND: 1. DEPUTY COMMISSIONER OF INCOME – TAX CENTRAL CIRCLE – 1(3), 3RD FLOOR, C.R. BUILDNG, QUEENS ROAD, BENGALURU- 560001. 2. PRINCIPAL CHIEF COMMISSIONER OF INCOME – TAX KARNATAKA & GOA CENTRAL CIRCLE- 1(3), 3RD FLOOR, C.R. BUILDING, QUEENS ROAD, BENGALURU- 560001. 3. THE DIRECTOR GENERAL OF INCOME TAX (INV.), C.R. BUILDING ANNEX, NO.1, QUEENS ROAD, BANGALORE – 560001. 4. CENTRAL REGISTRY OF SECURITISATION ASSET RECONSTRUCTION AND SECURITY INSTEREST OF INDIA (CERSAI) TOWER 1, OFFICE BLOCK, 4TH FLOOR, PLATE – A, ADJACENT TO RING ROAD, NBCC, KIDWAI NAGAR (EAST), NEW DELHI-110023 REPRESENTED BY ITS MD AND CEO. 2 5. CENTRAL DEPOSITORY SERVICES (INDIA) LIMITED (CDSL) REGISTERED OFFICE AT MARATHON FUTUREX, A-WING, 25TH FLOOR, NM JOSHI MARG, LOWER PAREL, MUMBAI 400013 REPRESENTED BY MD AND CEO. …RESPONDENTS (BY SRI.K.V. ARAVIND, ADVOCATE) THIS WRIT PETITION IS FILED UNDER ARTICLES 226 & 227 OF THE CONSTITUTION OF INDIA PRAYING TO DIRECT RESPONDENT NO.1 TO 3 TO PRODUCE DOCUMENTS THAT ARE RELEVANT TO THE ATTACHMENT ORDER DTD 06.08.2019 (DOCUMENT NOT AVAILABLE), PURSUANT TO THE LETTERS ADDRESSED BY THE PETITIONER DTD 18.01.2021 ADDRESSED TO THE RESPONDENT NO.1 AND 2, RESPECTIVELY VIDE ANNX- H AND H1, LETTERS DTD RESPECTIVELY VIDE ANNX-K AND K1 AND LETTER DTD 23.02.2021 VIDE ANNX-M REQUESTING FOR THE SAME AND ETC. THIS WRIT PETITION COMING ON FOR ORDERS THIS DAY, THE COURT MADE THE FOLLOWING: ORDER Petitioner is knocking at the doors of writ court essentially for two prayers namely: (a) A direction for furnishing copies of the documents that were considered for issuing the attachment order dated 6.8.2019, as requested in his letters dated 18.1.2021, 8.2.2021 & 23.2.2021; (b) Quashing of the attachment order dated 6.8.2019 coupled with a direction to respondents to remove all encumbrances in respect of shares pledged to the petitioner 3 and remove the restrictions on operation of the account in question. 2. After service of notice, the respondents having entered appearance through their panel counsel, resist the Writ Petition inter alia contending that the question of quashing the attachment order now pales into insignificance since the said order was provisional in nature and has spent itself with the passing of the assessment order; so far as furnishment of copies of documents are concerned, it is a matter of law and if petitioner makes an appropriate application in the prescribed form to the competent authority, the same will be considered in accordance with law; however, prima facie there is impediment for entertaining the said prayer since those documents may fall within the conspectus of privacy of some other person/assessee; so contending, the panel counsel seeks dismissal of Writ Petition. 3. Having heard the learned counsel for the parties and having perused the Petition Papers, this court grants a limited indulgence in the matter as under and for the following reasons: 4 (a) It is the specific case of the Revenue that the impugned order of attachment being provisional in nature, has spent itself with the passing of the assessment order; that being the position, the question of quashing would not arise; the vehement submission of learned counsel for the petitioner that the Tax Recovery Officer has also clamped similar attachment under the provisions of II schedule to the Income Tax Act, 1961, need not be considered in this case since it constitutes an independent cause of action for which a separate challenge may be laid in accordance with law. (b) Petitioner has sought for certain information/documents from the hands of answering respondents; the contention of the Revenue that petitioner being a third person cannot be furnished with the same, is bit difficult to countenance; statutory scheme provides for grant of information subject to privacy issue, cannot be disputed; the person who seeks information/documents has to make the application in the prescribed form and pay the requisite fee therefor; if the petitioner makes such an application, the same needs to be considered in a time bound way; since the Revenue has taken a prima facie contention that petitioner being a third person, cannot be given the said information, 5 because of “privacy issues of the assessee”, it needs to be made clear that petitioner who is holding pledge of the shares in question shall not be treated as a third person. In this above circumstances and with the above observations, this Writ Petition is disposed off; time for compliance is thirty days from the date the petitioner makes the application in the prescribed form with requisite fees; the answering respondents shall pay to the petitioner Rs.2,500/- each, per day should delay be brooked in considering the subject application as above. Sd/- JUDGE SB "