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TMI Blog2014 (4) TMI 989X X X X Extracts X X X X X X X X Extracts X X X X ..... f the land and building or the plant and machinery. Statutory liabilities arising out of the land and building could be in the form of the property tax or other types of cess relating to property etc. Likewise, statutory liability arising out of the plant and machinery could be the sales tax etc. payable on the said machinery. As far as dues of the Central Excise are concerned, they were not related to the said plant and machinery or the land and building and thus did not arise out of those properties. Dues of the Excise Department became payable on the manufacturing of excisable items by the erstwhile owner, therefore, these statutory dues are in respect of those items produced and not the plant and machinery which was used for the purpose ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or attachment and sale of moveable property for recovery of such arrears of Revenue were undertaken. 3.2 M/s. Vaishnavi Dyeing Printing Mills Ltd also was indebted to Gujarat Industrial Investment Corporation Ltd ( GIIC for short) and for the recovery of its dues, GIIC had auctioned the factory located at GIDC, Sachin, Surat along with plant and machinery owned by M/s. Shree Vaishnavi Dyeing and Printing Mills Ltd. 3.3 The respondents purchased such factory along with land, building, plant and machinery from the proceeds of auction from the GIIC. A show cause notice was issued on 16.2.2006 for the recovery of the said outstanding dues of Rs. 16.91 lakhs with interest and attachment of property under section 142(1)( ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... were sold free from all encumbrances but the same had a stipulation that all these statutory liabilities arising out of the land shall be borne by purchaser in the sale deed and all these statutory liabilities arising out of the said properties shall be borne by the vendee and the vendor shall not be held responsible in the agreement of sale. The Court discussing various earlier pronouncements on the subject held that where buyer had purchased entire business, he would be liable for central excise duty. Otherwise, buyer could not be fastened with liability relating to dues of Government in absence of any specific statutory provision stipulating 'first charge for the purchaser'. The Apex Court held as under : 21. A ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 23. We may notice that in the first instance it was mentioned not only in the public notice but there is a specific clause inserted in the Sale Deed/Agreement as well, to the effect that the properties in question are being sold free from all encumbrances. At the same time, there is also a stipulation that all these statutory liabilities arising out of the land shall be borne by purchaser in the sale deed and all these statutory liabilities arising out of the said properties shall be borne by the vendee and vendor shall not be held responsible in the Agreement of Sale. As per the High Court, these statutory liabilities would include excise dues. We find that the High Court has missed the true intent and purport of this clause. The expre ..... X X X X Extracts X X X X X X X X Extracts X X X X
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