The Judgment of the Court was delivered by

Shivashankar Bhat, J.:— In these Appeals, we are mainly concerned with the scope of Rule 16 of the Second Schedule to the Income-tax Act, 1961 (These Rules are referred to hereinafter as ‘the Rules’).

2. These appellants entered into an agreement with the third respondent. It is dated 23-2-1984. The agreement was to purchase a house property belonging to the third respondent, for a sum of Rs. 2,80,000/-, out of which a sum of Rs. 1,30,000/- was paid as advance. The third respondent was a defaulter in the payment of taxes under the provisions of the Income-tax Act, 1961 (‘the Act’, for short) and consequently, notices in Form I, T.C.P.I were served on him in the year 1973, under Rule 2 of the Second Schedule to the Act. Subsequently, the property in question was attached under Rule 48 of the Rules (read with Form No. 1, T.C.P 16). Thereafter, there was a proclamation of Sale and sale of the property by public auction was held on 19th August 1987. The 3rd respondent defaulter was in arrears of tax, in a sum of Rs. 5,99,509/-. He did not choose to challenge the sale. However, the appellants invoked Rule 61 of the Rules to set aside the said sale.

3. Question is whether the appellants were competent to invoke the said Rule 61, relevant part of which reads:

“61. Application to set aside sale of immovable property on ground of non-service of notice or irregularity: Where immovable property has been sold in execution of a certificate, the Income-tax Officer, the defaulter, or any person whose interests are affected by the sale, may, at any time within thirty days from the date of the sale, apply to the Tax Recovery Officer to set aside the sale of the immovable property on the ground that notice was not served on the defaulter to pay the arrears as required by this Schedule or on the ground of a material irregularity in publishing or conducting the same:

Provided that - xxxx”.

(omitted as unnecessary)

4. The Tax Recovery Officer held that there was irregularity in the auction sale proceedings and consequently overruled the objections of the appellants. On appeal, the Recovery Commissioner held, inter alia, that the appellants were not eligible to invoke Rule 61 and the agreement between them and the 3rd respondent was ineffective to confer any right on the appellants in view of Rule 16(1) of the Rules. The learned single Judge affirmed the view of the Recovery Commissioner on this question and consequently did not go into the other questions raised against the validity of the auction sale.

5. The eligibility of the appellants to invoke Rule 61 depends upon the answer to the question as to whether they are “persons whose interests are affected by the sale”.

6. Mr. Sarangan, the learned Senior Counsel for the appellants, contended that the words “any person whose interests are affected by the sale” are of wide import so as to include a person who has entered into an agreement to purchase the property in question; it was argued that the sale of property to a third party would defeat the rights of the person to whom the original owner had agreed to sell the property and, therefore, such a person is entitled to invoke Rule 61 to have the auction sale set aside. According to the learned Counsel, there is a distinction between “a person who has an interest in the property” and “a person whose interests are affected by the sale”; therefore, even though an agreement of sale did not create an interest in the property, still, the interests of the person to whom property was agreed to be sold is vitally affected by the sale.

7. The learned single Judge compared the relevant provisions under Order XXI Rule 58 of the Code of Civil Procedure with the Rules with which we are concerned and held that there is no reason to take a different view regarding the eligibility of a person to question the auction sale under these Rules, even though the words used in Order XXI Rule 89 CPC are “any person claiming an interest in the property sold”, while the words in Rule 61 are “any person whose interests are affected by the sale.”

8. It is clear that the person invoking Rule 61 should be either the ‘defaulter’ himself, or any person whose interests are affected. The term ‘interests’ in a fiscal Statute, can only be an ‘interest’ recognised by law. Under Rule 16, the defaulter is incompetent to deal with his property in any manner which would include entering into an agreement to alienate the said properties; therefore, such an agreement would not create any interest in the person who agreed to purchase the property.

9. Rule 48 provides for attachment of the immovable property of the defaulter; by virtue of Rule 51 this attachment relates back to the date on which the notice to pay the arrears was issued. Therefore, in the instant case, the attachment related back to the year 1973 and thus, admittedly, on the date of the agreement, there was an attachment of the property in question.

10. Rule 16(1) which is relevant, here, reads:—

“16. Private alienation to be void in certain cases - (1) Where a notice has been served on a defaulter under Rule 2, the defaulter or his representative in interest shall not be competent to mortgage, charge, lease or otherwise deal with any property belonging to him except with the permission of the Tax Recovery Officer, nor shall any civil court issue any process against such property in execution of a decree for the payment of the money.”

11. Mr. Sarangan wants us to hold that Rule 16 operates only against a transaction resulting in alienation of the property or any interest in the said property. The learned Counsel relied on the heading of the Section, in addition to the Rule of Construction that the meaning of a word is to be judged by the company it keeps; in other words, when Rule 16 says that the defaulter or his representative-in-interest shall not be competent to “mortgage, charge, lease or otherwise deal with any property”, it does not cover execution of an agreement to sell the property; words “otherwise deal with” the properly have to be understood as dealing with the property in a manner similar to the creation of any charge or lease resulting in transfer of an interest in the property. Creation of a charge or lease results in transfer of an interest in the property and a similar result should flow out of other kinds of dealing with the property, to attract the application of Rule 16, having regard to the Rule of Interpretation “noscitur a socis”, a facet of which is the Rule of ejusdem generis, as per the latter rule, when particular words pertaining to a class, category or genus are followed by general words, the general words are construed as limited to things of the same kind as those specified.

12. There are two reasons why this argument cannot be accepted. Though in the case of a mortgage there is a transfer of an interest in the property, in a ‘charge’ there is no transfer of an interest in the property but the creation of a right of payment out of the specified property (vide: Mulla's Transfer of Property Act, 7th Edn., pages 605 and 360). In the case of a lease there is a transfer of a right to enjoy the property leased and, therefore, there is a transfer and an interest in land is created thereby (vide: page 631 of Mulla's T.P Act). Therefore, the words ‘mortgage, charge and lease’ in Rule 16 do not form a category or a class by themselves with reference to the alleged common characteristic of transferring an interest in the land.

13. Secondly, the words, ‘otherwise deal with any property’ convey a wider meaning. The word ‘otherwise’ itself indicates a situation which is dissimilar to the situation reflected in the words preceding it. Similarly, the words “dealing with” any property convey a variety of transactions touching the property in question.

14. In Lilavati Bai v. State of Bombay . AIR 1957 SC 521., Explanation to Section 6 of Bombay Land Requisition Act 1948 came up for consideration. The effect of the word “otherwise”, following certain other words was construed as a word of extension and not a word of limitation and that the Rule of ejusdem generis was held as inapplicable to such a situation. At page 528, Supreme Court observed:

“As an offshoot of the argument that we have just been examining it was contended on behalf of the petitioner that Explanation (a) to Section 6 quoted above contemplates a vacancy when a tenant (omitting other words not necessary) “ceases to be in occupation upon termination of his tenancy, eviction, or assignment of transfer in any other manner of his interest in the premises or otherwise.” The argument proceeded further to the effect that in the instant case admittedly there was no termination, eviction, assignment or transfer and that the words “or otherwise” must be construed as ejujsdem generis with the words immediately preceding them; and that therefore, on the facts as admitted even in the affidavit filed on behalf of the Government there was in law no vacancy. In the first place, as already indicated, we cannot go behind the declaration made by the Government that there was a vacancy. In the second place, the rule of ejusdem generis sought to be pressed in aid of the petitioner can possibly have no application. The Legislature has been cautious and thorough going enough to bar all avenues of escape by using the words “or otherwise”. Those words are not words of limitation but of extension so as to cover all possible ways in which a vacancy may occur. Generally speaking, a tenant's occupation of his premises ceases when his tenancy is terminated by acts of parties or by operation of law or by eviction by the landlord or by assignment of transfer of the tenant's interest. But the legislature, when it used the words “or otherwise” apparently intended to cover other cases which may not come within the meaning of the preceding clauses, for example, a case where the tenant's occupation has ceased as a result of trespass by a third party. The Legislature, in our opinion, intended to cover all possible cases of vacancy occurring due to any reasons whatsoever. Hence far from using those words ejusdem generis with the preceding clauses of the explanation, the Legislature, used those words in all inclusive sense.”

15. Again, in Kavalappara Kottarathil Kochuni @ Moopil Nayar v. State of Madras . AIR 1960 SC 1080. Supreme Court held that rule of ejusdem generis was inapplicable to the situation resulting from the word ‘otherwise’, following a set of words in a statutory provision. It was held that it was a word of the widest amplitude, to cover varieties of situations, to effectuate the statutory provision. At page 1103, Supreme Court held:

“The word ‘otherwise’ in the context, it is contended, must be construed by applying the rule of ejusdem generis. The rule is that when general words follow particular and specific words of the same nature, the general words must be to the things of the same kind as those specified. But it is clearly laid down by decided cases that the specific words must form a distinct genus or category. It is not an inviolable rule of law, but is only permissible inference in the absence of an indication to the contrary. On the basis of this rule, it is contended, that the right or the custom mentioned in the clause is a distinct genus and the words ‘or otherwise’ must be confined to things analogous to right or contract such as lost grant, immemorial user etc. It appears to us, that the word ‘otherwise’ in the context only means “whatever may be origin of the receipt of maintenance.” One of the objects of the legislation is to by-pass the decrees of the courts and the Privy Council observed that the receipt of the maintenance might even be out of the bounty. It is most likely that a word of the widest amplitude was used to cover even acts of charity and bounty”.

Heading prefixed to a statutory provision is resorted to as an aid to construe the meaning of the provision only when the enacting words are ambiguous; normally, the heading cannot curtail the scope of the enacted words.

16. In Bhinka v. Charan Singh . AIR 1959 SC 960 @ 966. the Supreme Court quoted with approval, the following statement of the principle, from Maxwell on Interpretation of Statutes:

“The headings prefixed to sections or sets of sections in some modern statutes are regarded as preambles to those sections. They cannot control the plain words of the statutes, but they may explain ambiguous words.”

If there is any doubt in the interpretation of the words in the Section, the heading certainly helps us to resolve that doubt.”

17. In the instant case, having regard to the clear language of Rule 16, there is no reason to restrict the operation of the said Rule by reference to its heading.

18. Therefore, it is clear that a person who has entered into an agreement to purchase a property which is under attachment does not derive any right thereunder so as to confer on him the status of “a person whose interests are affected by the sale”. The agreement under which he claims such a status falls within the bar imposed by the words of Rule 16; the defaulter was incompetent to enter into such an agreement of sale, agreeing to sell the attached property; therefore, such an agreement is liable to be ignored by the Revenue.

19. In Messrs Rajata Trust v. Chief Commissioner Of Income-Tax* . 193 ITR 220. this Court held that even though the phrase “person interested” was defined in inclusive terms under Section 269 UA of the Act, a person who agreed to purchase the property in question under an agreement of sale would not be covered by the said definition. The Bench therein once again reiterated the principle that an agreement of sale does not create any right or interest in the land agreed to be purchased/sold.

20. In Tax Recovery Officer, Dharwar v. Hansaben . 135 ITR 572 @ 578. a learned Judge of this Court applied Rule 16 to a Court sale.

21. The Decision of the Gujarat High Court in M.H Pandya v. Tax Recovery Officer . 178 ITR 538. cited by Sri Sarangan need not be considered as it was under the provisions of Urban Land (Ceiling and Regulation) Act. Similarly, the Decision reported in Jose v. Anantha Bhat . ILR 1986 KAR 4031. with reference to the provisions of the Karnataka Land Reforms Act has no bearing on the question before us.

22. Shivanappa Sidramappa Prantur v. Virupaxappa Allappa Bagi . ILR 1980 KAR 702. also is a Decision under the Karnataka Land Reforms Act.

23. Mr. Sarangan then contended that even if the appellants were incompetent to invoke Rule 61, they are still eligible to file these Writ Petitions. This distinction sought to be projected by the learned Counsel has no substance. If the appellants are ineligible to invoke Rule 61 and challenge the sale as prescribed by the Statute, they cannot be deemed to have a better right to challenge the said sale indirectly, by recourse to the Writ Jurisdiction. Rights and liabilities created by the statutory provisions, so long as they are constitutionally valid, cannot be enlarged in this manner by recognising a right in a person to challenge the statutory proceedings indirectly, when the statute does not permit him to do so. However, cases involving public interest need not be considered here, because, the right sought to be safeguarded here, by the appellants, is purely a private right of the appellants. In fact, a Bench of this Court has already taken a similar view of Rule 16 in Writ Appeal No. 293 of 1991 disposed of on 13.2.19929.

24. In the result, we are of the view that a person who has entered into an agreement to purchase an immovable property which has been attached under the provisions of the Second Schedule to the Act is not a person competent to invoke Rule 61 of the said Rules and such a person cannot seek setting aside of the sale of the property in pursuance of the attachment.

Consequently these Writ Appeals are dismissed without any order as to costs.