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"55.xxxxxxxxxSimilarly, under Section 281B where, during the pendency of any proceeding for the assessment of any income, the ITO was of the opinion that for the purpose of protecting the interests of the revenue, it was necessary to do so, he may, with the previous approval of the Commissioner, by order in writing, attach provisionally any property belonging to the assessee in the manner provided in the Second Schedule. xxxxxxxxxx Section 281B is a power to be exercised during the pendency of any proceeding for assessment, so that the assessee does not fritter away or secrete his resources out of the reach of the department when the assessment is completed. Having regard to the provisions of Sections 226 and 281B, it would be clear that Section 132 is intended to be invoked even in the absence of any pending proceeding.

According to the learned Senior counsel, Section 281B of the Act was inserted for safeguarding the interests of the revenue wherever it was thought by the Assessing officer that recovery of the amount found due on regular assessment would be jeopardized and where the raising of the demand is likely to take time and the assessee may thwart the collection of that demand. It was further submitted that provisions of provisional attachment under Section 281B of the Act are analogous to Order 38 Rule 5 of Code of Civil Procedure which provides for attachment before judgment and would become inoperative after the passing of the assessment order. It was also pointed out that after the passing of assessment order, under Proviso to sub-section (1) of Section 220 of the Act relating to recovery of outstanding demand, the Assessing Officer is authorised to give lesser period than 30 days for depositing the outstanding amount after obtaining approval of the Joint Commissioner provided the Assessing Officer has reason to believe that allowing of full period of 30 days would be detrimental to the revenue.

6. Further, the impugned order was also sought to be challenged on merits as well pointing out that no satisfaction as required under the provisions of Section 281B of the Act had been fulfilled in as much as the Assessing Officer was influenced by the fact that in the immediately preceding year, a demand of ` 161 crores had been made against which the assessee had moved a stay application before the Income Tax Appellate Tribunal, New Delhi and order for stay of demand had been passed by the Tribunal and as a result, the revenue could not recover any amount from the assessee. It was also urged that the Assessing officer while framing the assessment order and issuing notice under Section 156 of the Act had allowed 30 days time to deposit the tax demand and therefore, till the expiry of the aforesaid period, the assessee could not be treated to be an assessee in default and the order of provisional attachment is, thus, legally not sustainable.

Provided also that the period during which the proceedings for assessment or reassessment are stayed by an order or injunction of any court shall be excluded from the period specified in the first proviso."
9. A plain reading of Section 281B of the Act clearly spells out that the Assessing Officer is empowered to pass order for provisional attachment to protect the interests of the revenue in certain cases during the pendency of any proceeding for the assessment of any income or for the assessment or reassessment of any income which has escaped assessment. However, the Assessing Officer is required to form an opinion that the same is necessary for the purposes of protecting the interests of the revenue. Further requirement has been specified therein, wherein approval of the Chief Commissioner or Commissioner or Director General or Director is to be obtained before passing the order for provisional attachment. Under Sub-section (2) thereof, the period during which the order remains operational has been provided which is six months from the date of the order made under Sub-section (1) of Section 281B of the Act. However, the Chief Commissioner or Commissioner or Director General or Director has been authorised, after recording reasons in writing, to extend the aforesaid period for further period or periods as in their opinion would be justified but the total period of extension shall not, in any case, exceed two years. In other words, according to the aforesaid provision, during the pendency of any assessment proceeding or proceedings in pursuance to reassessment that in order to safeguard the interests of the revenue, after recording reasons for the same in writing and seeking the approval from the concerned authority, an order for provisional attachment can be passed.