State Bank Of India vs M.C.D. And Ors.
2003 Latest Caselaw 216 Del

JUDGMENT

Sanjay Kishan Kaul, J.

Rule.

1. With the consent of learned Counsel for the parties, the petition is taken up for final disposal.

2. It is a classic case of being more loyal than the king. The distress warrant was issued against respondent No. 3 by respondent No. 1 Corporation on account of arrears of property tax- Surprisingly, respondent No. 3 did not challenge the warrant of distress in the present proceedings, though learned Counsel for the respondent No. 3 submits that separate proceedings had been initiated by the said respondent and the assessment order had been quashed and the matter has been remanded back to the Assessing Authority.

3. Learned Counsel for the petitioner bank, however, contends that the matter in issue should be still considered and decided in view of the fact that the petitioner Bank is faced with such a situation on numerous occasions.

4. The first objection raised by learned Counsel for the respondent Nos. 1 and 2/Corporation is that the petitioner has no locus standi to file the present writ petition in view of the fact that the petitioner is not the affected party and it is the respondent No. 3, which is the affected party. I am in agreement with the submission of the learned Counsel for the respondent Nos. 1 and 2. There was no occasion for the petitioner Bank to have come to Court in respect of the warrant of distress issued. Needless to say, if the respondent No. 3 being the assessed in question is aggrieved by any assessment order or the consequential warrant of distress, it is for the assessed to impugn the same in accordance with law.

5. Be that as it may, learned Counsel for the petitioner contends on merits of the controversy that there is no provision for execution of such warrant of distress by the respondent Corporation against the bank. Learned Counsel referred to the provisions of Section 156 of the Delhi Municipal Corporation Act, 1957 (hereinafter to be referred as, 'the said Act') in this behalf. It may be noted that the warrant of distress has been issued under Section 156(1) of the said Act. The provisions of the said Section 156 are as under:

"156. Recovery of tax-

(1) If the person liable for the payment of the tax does not, within thirty days from the service of the notice of demand, pay the amount due, such sum together with all costs and the penalty provided for in Section 155, may be recovered under a warrant, issued in the form set forth in the Eighth Schedule, by distress and sale of the movable property or the attachment and sale of the immovable property, of the defaulter :

Provided that the Commissioner shall not recover any sum the liability for which has been remitted on appeal under the provisions of this Act.

(2) Every warrant issued under this section shall be signed by the Commissioner."

6. Learned Counsel contends that the expression used is "distress and sale of the movable property", which did not imply that the bank accounts can be attached. Learned Counsel in this behalf has referred to the expression "distress" under Section 157 of the said Act. The said provision is as under :

"157. Distress-

(1) It shall be lawful for any officer or other employees of the Corporation to whom a warrant issued under Section 156 is addressed to distrain, wherever it may be found in any place in Delhi, any movable property or any standing timber, growing crops or grass belonging to the person therein named as defaulter, subject to the following conditions, exceptions and exemptions, namely:

 (a)    the following property shall not be distrained :  
   

 (i)     the necessary wearing apparel and bedding of the defaulter, his wife and children and their cooking and eating utensils;  
 

 (ii) tools of artisans;   
 

 (iii)  books of account; or  
 

(iv) when the defaulter is an agriculturist his implements of husbandry, seed, grain and such cattle as may be necessary to enable the defaulter to earn his livelihood;

(b) the distress shall not be excessive, that is to say, the property distrained shall be as nearly as possible equal in value to the amount recoverable under the warrant and if any property has been distrained which, in the opinion of the Commissioner, should not have been distrained, it shall forthwith be released.

(2) The person charged with the execution of a warrant of distress shall forthwith make an inventory of the property which he seizes under such warrant, at the same time, give a written notice in the form set forth in the Ninth Schedule, to the person in possession thereof at the time of seizure that the said property will be sold as therein mentioned."

7. Learned Counsel contends that the said provision of distress cannot apply to the money lying in the account. This is further supported by the contention that the money of assessed lying in the account merges with the money of bank and does not remain the money of the assessed.

8. I am unable to accept the contention of the learned Counsel for the petitioner. The money when deposited with the bank remains the money of the depositor, but in custody of the bank. The expression used in Section 156(1) refers to "movable property" and the money would certainly fall within the said category. A reading of Sections 156 and 157 of the said Act together, in my considered view, imply that it is open to the respondent Corporation to attach money of the assessed lying with the bank in case the property tax is unpaid.

9. I am also unable to accept the contention of the learned Counsel for the petitioner that excess money may be recovered in view of the fact that the provisions of Section 157(1)(b) of the said Act make it clear that what is sought to be distrained has to be as nearly as possibly equal in value to the amount recoverable. The amount is known and in case of a bank account, this problem would not arise at all since it is only to the extent of dues of the assessed that an attachment can take place and that too subject to availability of money with the bank of the assessed.

10. In my considered view, the petition is misconceived and without any merit or substance.

Dismissed.

CM No. 14548/1999:

Dismissed.

Interim orders stand vacated.