SOHAM SECURITIES LIMITED V. ASSISTANT COMMISSIONER OF INCOME TAXOR HIS SUCEESSOR TOOFFIC

SCA/16617/2012

AI Insights

The case involves Soham Securities Limited, the petitioner, who challenged the illegal attachment order of their bank account by the Assistant Commissioner of Income Tax, the respondent. The petitioner sought various writs including certiorari and mandamus to quash the attachment order and sought damages for loss of business and reputation. During the proceedings, the attachment was lifted, rendering some prayers infructuous. The remaining issues pertained to claims for interest on the frozen amount and damages, which were contested by the respondent citing statutory powers and valid reasons for the attachment. The court found that resolving these issues would require delving into disputed facts, which is not suitable for a writ petition.

• Counselvise Citation: [2014] 140 COUNSELVISE.COM (IT) 754285 (HC-GUJARAT)
• Appeal Type: Others
• Pronouncement Date: 05-05-2014
• Assessment Year: misc
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Partly Allowed
• Court: HIGH COURT
• Department Lawyers: K M PARIKH
• Assessee Lawyers: R K PATEL
• Keywords: Bank Account; Illegal Attachment; Income Tax; Mala fide; Writ of Certiorari; Writ of Mandamus; Statutory powers
• Section: 226(3); 281-B

Judgement Text

"C/SCA/16617/2012 JUDGMENT IN THE HIGH COURT OF GUJARAT AT AHMEDABAD SPECIAL CIVIL APPLICATION NO. 16617 of 2012 FOR APPROVAL AND SIGNATURE: HONOURABLE MR.JUSTICE AKIL KURESHI and HONOURABLE MS JUSTICE SONIA GOKANI ================================================================ 1 Whether Reporters of Local Papers may be allowed to see the judgment ? 2 To be referred to the Reporter or not ? 3 Whether their Lordships wish to see the fair copy of the judgment ? 4 Whether this case involves a substantial question of law as to the interpretation of the Constitution of India, 1950 or any order made thereunder ? 5 Whether it is to be circulated to the civil judge ? ================================================================ SOHAM SECURITIES LIMITED....Petitioner(s) Versus ASSISTANT COMMISSIONER OF INCOME TAXOR HIS SUCEESSOR TOOFFIC & 5....Respondent(s) ================================================================ Appearance: MR RK PATEL, ADVOCATE for the Petitioner(s) No. 1 MR KM PARIKH, ADVOCATE for the Respondent(s) No. 1 - 6 ================================================================ CORAM: HONOURABLE MR.JUSTICE AKIL KURESHI and Page 1 of 4 C/SCA/16617/2012 JUDGMENT HONOURABLE MS JUSTICE SONIA GOKANI Date : 05/05/2014 ORAL JUDGMENT (PER : HONOURABLE MR.JUSTICE AKIL KURESHI) 1. The petitioner has made the following prayers : “(A) Issue a writ of certiorari and/or a writ of mandamus and/or any other writ direction or order to quash and set aside the illegal attachment order dated 26.7.2012 of the bank account of the petitioner by the respondent at Annexure­L. (B) Pending admission, hearing and disposal of this petition, ad interim relief in terms of para (A) may kindly be granted. (C) Pending admission, hearing and till final disposal of the this petition, stay the implementation/operation of the Notice dt. 21.11.2012 at Anneuxre­S. (D) Issue a writ of certiorari and/or a writ of mandamus and/or any other writ direction or order directing the respondent to pay interest at the rate of 12% or bank rate or any other rate or mode or measure, which the Hon’ble Court deems fit for the period 12.8.2011 onwards till the date of revocation of Bank account NO.910020050265257 with the Axis Bank. (E) Issue a writ of certiorari and/or a writ of mandamus and/or any other writ direction or order directing the respondent to award a sum as determined by the Hon'ble Court towards damages for loss of business and reputation of the petitioner due to illegal attachment under section 226(3) and subsequently under section 281­B of the Page 2 of 4 C/SCA/16617/2012 JUDGMENT Income Tax Act, 1961. (F) Award the cost of this petition. (G) Grant such other and further reliefs as this Hon'ble Court deems fit.” 2. During the pendency of the petition, the attachment order dated 26.7.2012 of the bank account of the petitioner having been lifted, these prayers does not survive. Corresponding interim prayers (B) and (C) also therefore, have become infructuous. The surviving prayer pertains to the petitioner’s claim for interest at appropriate rate on the amount lying in the bank account of the petitioner which was frozen and for payment of damages. 3. The case of the petitioner is that the bank account was frozen illegally and in a highhanded manner. On the other hand, respondent no.6 against whom personal allegations of mala fide have been made and therefore, is joined in his personal capacity, through series of affidavits, it is contended that attachment order was passed in exercise of statutory powers for valid reasons. 4. Having heard learned counsel for the parties and having perused the material on record, we are of the opinion that the question of mala fide and the allegations of exercise of power irregularly or for ulterior motives, cannot be judged in this writ petition being highly disputed questions of fact. We had heard learned advocates for the parties at a considerable length. We have also perused the documents on record. However, in order to grant prayers made by the Page 3 of 4 C/SCA/16617/2012 JUDGMENT petitioner for awarding interest or cost, number of disputed questions of fact shall have to be gone into. The petitioner’s averments and allegations are very serious levelling allegations of personal mala fide against respondent no.6. Respondent no.6 however, on the other hand has relied on certain statements and concessions made by the petitioner. Case of the said respondent is that Shri Krishna Somani agreed to offer the amount lying in the said bank account though in the name of the company for the recovery of tax due from him in his personal capacity in order to avoid unpleasant consequences arising out of coercive tax recovery. 5. In the present case, we are not inclined to go into such disputed questions leaving it open to the petitioner to avail such remedy as may be available under the law. We make it clear that all contentions are kept open. 6. Petition is disposed of with above observations. (AKIL KURESHI, J.) (MS SONIA GOKANI, J.) raghu Page 4 of 4 "