Class 3 | Income tax | Recovery of Tax | Modes of Recovery u/s 226 | Pankaj Batra Classes

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This lecture covers the topic of assessee in default and recovery by tax recovery officer (TRO) under Recovery of Tax. The topic is relevant for CA/CS/BCom/Mcom and BBA students.

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Income Tax - Residential status & Tax Liability:
Income From Salary:
Statistics:
Income Tax - How to Compute Income Tax Liability:
Recovery and Refund of Tax
Income Tax : Appeal and Revision
Statistics : Correlation Analysis
Statistics : Probability Distribution

Procedure of Procedure of recovery under Income Tax Act, 1961

1. Tax Recovery Officer (TRO) draw a certificate for execution u/s 222 mentioning the amount to be recovered

2. Certificate is drawn u/r 117B in form 57 and issue a notice requiring payment in 15 days and mentioning that if defaulted steps will be taken to realize via either attachment/sale of movable/ immovable property, arrest and detention of assesse and appointment of receiver for management of movable/immovable properties.

3. Recovery u/s 222 may continue irrespective of recovery via other modes have been taken

Attachment/ sale of movable/ immovable property

4. Once certificate for execution is drawn u/s 222, any person who fraudulently remove, conceal, transfer or deliver any property or interest therein, with intent to prevent execution of certificate issued u/s 222, stand punishable with rigorous imprisonment up to 2 years and fine

5. Attachment and sale of movable/ immovable property includes the properties transferred to spouse, minor child, son’s wife or son’s minor child otherwise than for adequate consideration

6. Action can be taken even prior to expiry of notice period of 15 days by recording reason in writing that defaulter is likely to conceal, remove or dispose of movable property and realization u/s 222 would be delayed or obstructed.

7. Defaulter can submit security based which TRO if satisfied may cancel attachment. Waiver application towards the interest to be decided by Principal Commissioner or Commissioner within 12 months from month end in which application is made.

8. The proceed on sale or otherwise of property first be utilized towards dues under certificate in execution followed by adjustment against any other dues and balance to be returned to defaulter, if defaulter dispute adjustment value then TRO will be deciding authority

9. Every question arises between TRO and defaulter relating to execution of certificate or setting aside of an order the Act for sale held in execution of such certificate shall be determined not by suit but by order of TRO however suit may be filed in civil court on ground of fraud

10. Properties which are exempt from attachment under CPC also exemption under the Act and TRO decision as to what property is so entitled to exemption shall be final

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