2018 (11) TMI 717 - HC - VAT and Sales Tax

Recovery of arrears of tax - attachment of ancestral property - Department floated an amnesty scheme for the defaulting dealers - Held that - Both the petitioners have every right to protect their interest vis- -vis the property. And for that, they wanted to take advantage of the scheme - the petitioners have eminently answered the description of the persons aggrieved. - petition allowed - decided in favor of petitioner.

Summary

Issues:
1. Application of amnesty scheme under the Kerala Value Added Tax Act to recover arrears of tax.
2. Interpretation of the term "aggrieved person" in the context of the amnesty scheme.
3. Rights of wife and daughter in ancestral property attached by the Department.

Issue 1: Application of amnesty scheme under the Kerala Value Added Tax Act to recover arrears of tax

The judgment involves a case where the Department initiated proceedings to recover arrears of tax owed by a firm with three partners, one of whom is the husband and father of the petitioners. The wife, being estranged from the husband, filed a petition before the Family Court to recover property and valuables. Subsequently, the wife, through her daughter, applied for the amnesty scheme offered by the Department to recover the attached property. However, the Department rejected the application, leading to the filing of a writ petition by the wife and daughter challenging the rejection.

Issue 2: Interpretation of the term "aggrieved person" in the context of the amnesty scheme

The petitioners argued that they should be considered "aggrieved persons" under the amnesty scheme as they have a stake in the assessee's estate. The petitioners contended that the husband's refusal to take advantage of the amnesty scheme was a deliberate attempt to prevent the wife and daughter from benefiting from the property. The Court, relying on precedent, determined that the wife, having secured a sale certificate, was akin to a purchaser and, therefore, had the right to protect her interest in the property. The Court held that the petitioners met the criteria of "persons aggrieved" and directed the authorities to reconsider their application under the Circular related to the amnesty scheme.

Issue 3: Rights of wife and daughter in ancestral property attached by the Department

The Court acknowledged the strained marital relationship between the wife and husband, leading to the wife and daughter being dependent on themselves. Despite the daughter's direct involvement in filing the application, the Court recognized her actions as representative of the mother's interests, considering the daughter as an ostensible agent of her mother. The Court emphasized that both the wife and daughter had a legitimate interest in protecting their rights concerning the attached property and, therefore, allowed the writ petition, setting aside the rejection of the application and directing the authorities to reconsider it promptly.

This detailed analysis of the judgment highlights the complex legal issues surrounding the application of the amnesty scheme, the interpretation of the term "aggrieved person," and the rights of the wife and daughter in the ancestral property attached by the Department under the Kerala Value Added Tax Act.