I-T attachment no bar for registering property after expiry period is over

The Tamil Nadu government has issued fresh guidelines to sub-registrars on the registration of properties under provisional attachment of the Income-Tax Department. A clarification has been issued that they can proceed with registration of property documents after the expiry of the statutory attachment period of six months.

Following complaints that sub-registrars were refusing to accept any registration of properties under provisional attachment under the Income Tax Act, 1961, even if it was brought for registration well beyond the expiry of the statutory attachment period, the State government has clarified on the issue.

Pointing out that there was no need for the sub-registrars to refuse registration of such properties by insisting on revocation orders, the Inspector-General of Registrations, in a circular dated April 9, 2021, said such actions caused hardship to the registering public, business community and also led to revenue loss to the State’s exchequer.

The circular said that the attachment order over any property issued by the IT department under Section 132(9B) of the IT Act, 1961, was only provisional and ceased to have effect after the expiry of six months. However, for reasons to be recorded in writing, the Director-General, Chief Commissioner or other senior officers in such capacity could extend the period of provisional attachment by such period/periods (each six months) as he/she deems fit. But the total period of extension shall not in any case exceed two years.

AG opinion

On complaints in this regard, the State referred the issue to the IT department and the Advocate General of Tamil Nadu for their views.

The A-G made it clear that when the IT Act specifically provided for the order of attachment being time-bound, the department cannot rely upon Section 281 to contend that the time stood enlarged till the disposal of the proceedings. Accepting the views of the A-G, the government issued guidelines that if a property was submitted for registration of any further documents well after the expiry of statutory attachment period as said in Section 132(9C) or Section 281(B)(2) read with appended extension of attachment proviso of IT Act, 1961, the registering officer “is not required to insist on the production of revocation order of NOC from Income-Tax Department and can proceed with registration after the confirmation of the expiry of the statutory attachment period.”

The government warned that any lapse on the part of the registering officers in ascertaining the expiry of statutory attachment period and registration of any property during the statutory attachment period would be viewed seriously and suitable disciplinary action initiated against them.