1. Mr.Ketan M. Parikh, learned advocate for the petitioner, prays for permission to join Shri Dhirubhai B. Patel, and the auction purchaser in the auction, that took place on 22.03.2012, Shri Kumar Pau, as party respondents. Permission to join the said respondents, is granted. The necessary amendments be carried out in the cause-title, forthwith.
2. Heard Mr.Ketan M. Parikh, learned advocate for the petitioner. He has made the following submissions:
(I) That the property attached by the Debt Recovery Tribunal, Ahmedabad ("the DRT" for short), as an executing Court to recover certified dues of the Recovery Certificate, cannot be attached by the respondent-Rajkot Municipal Corporation, ignoring the DRT's attachment of the property.
(II) The claim of the respondent-Rajkot Municipal Corporation has already been included by the Recovery Officer (respondent No.2) by drawing the sale proclamation under Section 62 of the Income Tax Act, 1961.
(III) As per Section 529-A of the Companies Act, 1956, municipal taxes shall not get priority over the dues of secured creditors and workmen having pari passu charge over secured creditors.
(IV) Even if we consider taxes to be a charge over the property, the same shall not prevail over the mortgage under the Transfer of Property Act, 1882.
(V) Under the second Schedule of the Income Tax Act, 1961, Rule 31 provides the remedy for the claimant/objector to approach the Recovery Officer for the decision of the claim and priority of the alleged dues.
(VI) That the respondent-Rajkot Municipal Corporation was in knowledge that the earlier auction of the property in March-2010 had been set aside by the DRT, Mumbai, therefore, it could not have auctioned the property on 22.03.2012.
3. Mr.Kamal Trivedi, learned Senior Advocate with Mr.Nishant Lalakiya, learned advocate for the respondent-Rajkot Municipal Corporation (Caveator), submits that the property was attached by the respondent-Rajkot Municipal Corporation on 15.02.2012 and the auction was held on 22.03.2012. The claim of the Rajkot Municipal Corporation is for Rs.39,65,610/-. Only the smallest part of the property has been auctioned. That the Rajkot Municipal Corporation had no knowledge regarding the DRT proceedings and the claim of the petitioner having been registered before the Recovery Officer.
4. Having heard the learned counsel for the respective parties, issue Notice, returnable on 02.04.2012.
5. It is made clear that the auction that took place on 22.03.2012, shall be subject to the final decision of the petition.
In addition to the normal mode of service, Direct Service is also permitted.
(Smt.
Abhilasha Kumari, J.) rakesh/ Top