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I-T dept arrests man for Rs 12 cr tax default

Press Trust of India  |  New Delhi 

The Department has invoked a rarely used power and arrested a for alleged default of about Rs 12 crore, a said Tuesday.

The said the man, who has not been identified, was arrested by the Recovery Officer (TRO) of the (Karnataka) from the on Monday, when he was about to take a flight to a foreign destination.

The man has been "detained in civil prison for a period of six months", the department said in a statement.

He was wanted by the department's and region office, headquartered in

"He owed income tax and penalty arrears of Rs 11.94 crore plus interest," it said.

"Aside from non-payment of due taxes, the defaulter was found to have illegally transferred property situated at Yeshwanthpur in

"As per Rule 73 of the second schedule to the Income Tax Act, if a defaulter transfers his property after the service of ITCP-l (I-T notice), the certificate may be executed by arrest and detention of his person," the department said.

The statutory provision in Rule 16 prohibiting transfer of any property by the defaulter without the permission of the TRO is a stringent one and the defaulter must face the consequences of his wilful violation, it said.

The TRO is empowered to attach and sell assets, arrest a tax defaulter and also appoint a receiver to manage a defaulter's business.

However, these powers have been rarely invoked by the department in the past and very few arrests have ever been made by the taxman.

The department said the had "violated the provisions of section 222 of the Act and Rule 16 of the schedule by transferring immovable properties after the date of service of notice of demand".

Therefore, it said, the TRO held that "no further enquiry" is considered necessary and accordingly no custody pending hearing as per Rule 75 of the second schedule was ordered.

It said the man "failed to make satisfactory arrangement for payment of the tax arrears and he has been committed to civil prison on Tuesday at Parappana Agrahara central jail in for six months".

(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)

First Published: Tue, February 12 2019. 21:25 IST