In the event of establishing that the mortgage was prior to the initiation of action by the Income Tax Department, prior to the default of the Assessee under the Income Tax Act, then the Bank may claim right over mortgage property – State Bank of India Vs. The Tax Recovery Officer Income Tax Department – Madras High Court

Hon’ble High Court holds that in the event of establishing that the mortgage was prior to the initiation of action by the Income Tax Department, prior to the default of the Assessee under the Income Tax Department, then the Bank may claim right over such mortgages. However, in order to ascertain the clear facts and circumstances, an enquiry is to be conducted by the Tax Recovery Officer. Therefore under Rule 11 of Schedule II of the Income Tax Act, the petitioner-Bank has to approach the Tax Recovery Officer for adjudication of the facts, so as to form an opinion whether the petitioner-Bank is entitled to enforce their rights or not.

In the event of establishing that the mortgage was prior to the initiation of action by the Income Tax Department, prior to the default of the Assessee under the Income Tax Act, then the Bank may claim right over mortgage property – State Bank of India Vs. The Tax Recovery Officer Income Tax Department – Madras High Court Read Post »