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2025 (1) TMI 1030 - HC - VAT / Sales Tax
Recovery of arrears of tax due for the Assessment Year 2014-15 to 2016-17 - petitioner submits that Form-F which has been filed along with counter statement by the respondents is based on a forged signature of both the writ petitioner and his wife - liability of petitioner and his wife for the tax arrears of the petitioner s estranged son-in-law based on documents alleged to contain forged signatures - HELD THAT - Form F dated 12.04.2013 has been executed in front of Advocate Notary from Villupuram namely M/s.Lion M.Pandurangan. It bears the notarial seal and signature of the said Notary dated 22.04.2013. The variance in the date of Form-F as 12.04.2013 and the date of the notarial seal and signature as 22.04.2013 indicates that the said documents was not executed in presence of the said Advocate Notary. The signature of the deceased petitioner and his wife are also in variance with the other documents which have been produced before this Court which are stated to be genuine documents where the deceased petitioner and his wife S.Selvi have affixed their signature. The signature in Power of Attorney dated 15.03.1996 bears the signature of the deceased petitioner as a witness. It is in variance with the signature in Form-F dated 12.04.2013 which has been duly notarized on 22.04.2013. Similarly the signature of Mrs.S.Selvi in the Sale Deed dated 26.06.2018 different from the signature in the Form-F which have been filed along with the documents. The signature in Form-F are clear imitation of the signatures of the deceased petitioner and his wife Mrs.S.Selvi. Therefore neither the petitioner nor the petitioner s wife can be fastened to tax liability based on the aforesaid documents containing a forged signature of the deceased petitioner and his wife. Conclusion - Liability cannot be imposed based on forged documents. The property cannot be encumbered without a valid legal basis - The procedural inaction in unrelated matters does not justify dismissal of a writ petition. Petition allowed.
1. ISSUES PRESENTED and CONSIDERED
The core legal questions considered in this judgment are:
- Whether the petitioner and his wife can be held liable for the tax arrears of the petitioner's estranged son-in-law based on documents alleged to contain forged signatures.
- Whether the Commercial Tax Department can recover tax dues from the petitioner's property based on the impugned communication.
- Whether the writ petition should be dismissed due to the petitioner's alleged inaction in pursuing criminal proceedings against the estranged son-in-law.
2. ISSUE-WISE DETAILED ANALYSIS
Issue 1: Liability for Tax Arrears Based on Alleged Forged Documents
- Relevant legal framework and precedents: The legal framework involves the assessment of liability under the Tamil Nadu Value Added Tax (TNVAT) Act, 2006, and the Central Sales Tax, 1956. The court must determine the validity of documents purportedly binding the petitioner to the tax liability.
- Court's interpretation and reasoning: The court examined the discrepancies in the signatures on Form-F and other documents. It noted significant variances between the signatures on the contested documents and those on undisputed documents, suggesting forgery.
- Key evidence and findings: The court relied on the variance in signatures on Form-F and other documents, such as the General Power of Attorney and Sale Deed, to conclude that the signatures on Form-F were imitations.
- Application of law to facts: The court applied the principle that liability cannot be imposed on individuals based on forged documents. It found that the petitioner and his wife could not be held liable for the tax arrears due to the forged nature of the signatures.
- Treatment of competing arguments: The respondents argued that the amount was minimal and suggested payment by the petitioner's family. However, the court focused on the issue of forgery and the lack of legal basis for liability.
- Conclusions: The court concluded that neither the petitioner nor his wife could be held liable for the tax arrears due to the forged signatures on the relevant documents.
Issue 2: Recovery of Tax Dues from Petitioner's Property
- Relevant legal framework and precedents: The court considered the TNVAT Act, 2006, and the procedures for recovering tax dues from property owners.
- Court's interpretation and reasoning: The court determined that the property could not be used to recover tax dues based on the impugned communication due to the lack of a valid mortgage or lien.
- Key evidence and findings: The court noted the absence of a legitimate mortgage agreement binding the petitioner's property for the tax dues.
- Application of law to facts: The court applied the principle that property cannot be encumbered without a valid legal basis, which was absent in this case.
- Treatment of competing arguments: The respondents' argument for voluntary payment was dismissed due to the lack of legal obligation.
- Conclusions: The court concluded that the petitioner's property could not be used to recover the tax dues.
Issue 3: Dismissal of Writ Petition Due to Alleged Inaction
- Relevant legal framework and precedents: The court considered procedural aspects of pursuing criminal complaints and the relevance to the writ petition.
- Court's interpretation and reasoning: The court found that the petitioner's inaction in pursuing criminal proceedings was not a valid reason to dismiss the writ petition.
- Key evidence and findings: The court noted the petitioner's complaint to the police but found it irrelevant to the determination of tax liability.
- Application of law to facts: The court applied procedural fairness principles, focusing on the substantive issue of forgery rather than procedural delays.
- Treatment of competing arguments: The respondents' argument for dismissal based on inaction was rejected due to its irrelevance to the core issue of forgery.
- Conclusions: The court concluded that the writ petition should not be dismissed based on alleged inaction.
3. SIGNIFICANT HOLDINGS
- Preserve verbatim quotes of crucial legal reasoning: "The signature in Form-F are clear imitation of the signatures of the deceased petitioner and his wife Mrs.S.Selvi. Therefore, neither the petitioner nor the petitioner's wife can be fastened to tax liability based on the aforesaid documents containing a forged signature of the deceased petitioner and his wife."
- Core principles established: Liability cannot be imposed based on forged documents; property cannot be encumbered without a valid legal basis; procedural inaction in unrelated matters does not justify dismissal of a writ petition.
- Final determinations on each issue: The court allowed the writ petition, concluding that the petitioner and his wife were not liable for the tax arrears, and the property could not be used for recovery. The petition was not dismissed based on alleged inaction.