Section 223 of ITA, 1961 : Section 223: Tax Recovery Officer By Whom Recovery Is To Be Effected

Explanation using Example

Imagine a businessman, Mr. Sharma, owes a substantial amount of income tax and has not paid despite several reminders. The Income Tax Department decides to recover the tax by invoking the provisions of Section 223 of the Income-tax Act, 1961.

Mr. Sharma resides in Mumbai, but he also owns a factory in Pune and a vacation home in Goa. The Tax Recovery Officer (TRO) in Mumbai, where Mr. Sharma resides and conducts his primary business, initiates the recovery process.

Despite efforts, the TRO in Mumbai is unable to recover the full tax amount from Mr. Sharma's assets in Mumbai. However, knowing that Mr. Sharma has a factory in Pune and a house in Goa, the TRO decides to expedite the recovery process by involving other TROs.

Under Section 223(2), the Mumbai TRO sends a certified copy of the recovery certificate to the TROs in Pune and Goa, specifying the amount to be recovered from Mr. Sharma's assets located there. The TROs in Pune and Goa then proceed to recover the specified amounts as if they had initiated the recovery themselves, ensuring the tax owed by Mr. Sharma is collected efficiently from his assets across different jurisdictions.