Friday, February 21, 2014

Amount credited to PPF account immune from attachment for recovery of income-tax dues

The High Court held as under:
1)  Rule 10 of the Second Schedule to the Income-Tax Act provides that all such property as is by the Code of Civil Procedure, 1908, exempt from attachment and sale in execution of a decree of a civil court shall be exempt from attachment and sale under this Schedule.
2)  Proviso to section60(1) of Code of Civil Procedure contains list of properties which shall not be liable to attachment or sale which, inter alia, covers all deposits and other sums derived from any fund to which the Public Provident Fund Act, 1968, applies,  in so far as they are declared by the said Act as not to be liable to attachment;

3)  Therefore, any amount lying in the PPF account of a subscriber is immune from attachment and sale for recovery of the income tax dues. As long as an amount remains invested in a PPF account of an individual, the same would be immune from attachment from recovery of the tax dues. - Dineshchandra Bhailalbhai Gandhi v. Tax Recovery Officer [2014] 42 taxmann.com 300 (Gujarat)

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