Allowing the petition the Court held that there was no dispute on the fact regarding creation of the mortgage. However, in the order there was omission to mention finding on dates of initiation of proceedings and creation of the mortgage, to demonstrate that the mortgage was created subsequent to initiation of the proceeding. The Tax Recovery Officer has power under rule 83 in the Second Schedule empowering him to take evidence exercising power of a civil court. But in exercise of the power there must be laid evidence to substantiate the declaration of the mortgage being void. So far as rule 86 was concerned, the Department had not argued that order was not one, which was conclusive in declaring the mortgage void. No finding that the date of initiation of proceeding was prior to date of creation of the mortgage could be located in the order. Order was bad for being vague. The order is set aside.( AY. 2012 -13)
Bajaj Finance Ltd. v .Tax Recovery Officer(2023) 334 CTR 465 / (2024)461 ITR 397 (Orissa)(HC)
S. 281 : Certain transfers to be void -Recovery of tax — Secured creditor — Priority of debt — Mortgage of land and construction -— Attachment of property — Transfers void against Department —Finding on date of initiation of proceeding prior to date of creation of mortgage not found in order — Order vague — Order set aside- [ ITRule. 83 , Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 — Recovery of Debts and Bankruptcy Act, 1993, Art. 226 ]