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TMI Blog1967 (9) TMI 78X X X X Extracts X X X X X X X X Extracts X X X X ..... y this court on the 7th August, 1963. The appellant filed a claim for Rs. 22,468.88 against the said company before the official liquidator on account of the arrears of sales tax (both Central and State) due from the former as per the following details : Date of assessment order Assessment Years Total amount of tax assessed Tax paid Amount of tax in arrears Remarks 1 2 3 4 5 6 21.11.1955 1954-55 14,062.50 6,813.08 7,249.42 U.P.S.T. Act 31. 8.1957 1955-56 1,208.33 997.02 211.31 Do. 20. 5.1958 1956-57 324.78 324.73 0.05 Do. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... his contention was of a twofold nature. His first contention was that, on a correct interpretation of section 530(1)( a ) of the Companies Act, the sales tax in question was entitled to priority. His second contention was that, in any case, as the said sales tax had been ordered to be recovered as arrears of land revenue within the twelve months next preceding the date of the winding-up order, it was entitled to priority as land revenue. As for the claim for the last two items which was totally disallowed by the official liquidator, his contention was that as under section 17 of the Sales Tax Act, the legality and correctness of an assessment order could not be challenged in any other manner except that provided in that Act and as the offic ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he assessment years 1954-55 to 1958-59 can be held to have become due and payable within the twelve months next before the 7th August, 1963, that is, to say between the 7th August, 1962, and the 7th of August, 1963. So far as the question of the sales tax having become due and payable within the period commencing the 7th August, 1962, and ending the 7th August, 1963, is concerned, it is obvious that since the said sales tax was payable for the assessment years 1954-55 to 1958-59, it could neither have become due nor payable within the period aforementioned. It seems to me that what section 530(1)( a ) envisages is, the revenue, sales tax, etc ., which are currently due and payable at the time of the winding-up order and it does not inclu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... which are recoverable as arrears of land revenue. I am therefore, not satisfied that Sri Sapru's contention that as the said sales tax was ordered to be realised as arrears of land revenue during the twelve months next before date of the winding-up order, it should be treated as revenue which has become due and payable within that period, so as to be entitled to priority under that section. The second part of the first contention of Sri Sapru has also, therefore, to be rejected. The second contention of Sri Sapru has been noticed earlier, and as such need not be repeated here. It is common ground that the assessment orders relating to the assessment year 1959-60 under the U. P. Sales Tax Act and the Central Act, were passed ex parte on ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the official liquidator had no notice of the assessment proceedings, or of the assessment orders and the demand notices passed therein, he could not resort to the machinery provided under that Act till he got notice of the same, and it is also true that by the time he came to know about them the period for filing an appeal had expired, but the same cannot be said for the period after he got notice of the said assessment, i.e. , when the appellant filed the sales tax claim before him; thereafter there was no justification for his not taking any steps to challenge the legality, propriety and correctness of these assessment orders as provided under the Sales Tax Act. It was not as if the Sales Tax Act did not provide for such a contingency, f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 1964, and the 10th of August, 1964, in respect of the assessment year 1959-60 were wrongly rejected by the official liquidator. As these taxes were also neither due nor payable within the period of 12 months immediately preceding the date of the winding-up, they too were not entitled to any priority. The view taken by me above is however without prejudice to the official liquidator's right to approach, if he is so advised, the sales tax authority whether by way of appeal or revision praying for the recall of the assessment orders in question and for a fresh consideration of the assessments in respect of those assessment years. Thus for the reasons stated above I allow this appeal in part, set aside the decision of the official liquidator ..... X X X X Extracts X X X X X X X X Extracts X X X X
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