Recovery u/s 226(3)
Querist :
Anonymous
(Querist) 15 October 2011
This query is : Resolved
Is second party liable to pay amount due to first party (assessee) , to third party (Tax Department) , in case notice u/s 226(3) is issued to second party, i.e is it necessary to comply with 226(3)?
What are the legal complication in complying with 226(3)as aganist first party(assessee).
Vineet
(Expert) 15 October 2011
Notice u/s 226(3) is garnishee notice to be complied with if the sums payable to first party are due. Such notice is issued in respect of not only present outstandings but any sum which becomes in future also to the extent of recoverable mentioned in the notice.
Any default in compliance to garnishee notice puts the second party in the same pedestal as of first party as he is also treated as assessee in default in respect of such sums and IT department may initiate recovery proceedings against the garnishee also.
