9911796707
TMI Blog1998 (7) TMI 10X X X X Extracts X X X X X X X X Extracts X X X X ..... s. 1,20,105 subject to the mortgages mentioned in the sale deed executed by the court. The petitioner undertook to clear the encumbrances mentioned in the sale deed executed by the court. The said court auction was confirmed on July 3, 1984, and the learned Subordinate judge, Dindigul, executed a sale deed on July 3, 1984, and thus the petitioner obtained absolute right and title over the property. The total extent of lands purchased in the court auction sale was of an extent of 270 acres and V. R. V. and Company, the partnership firm is managing the lands on behalf of the petitioner. The petitioner was a tenant of the lands right from the year 1979 and has been paying the agricultural income-tax regularly, without any default. It is further stated that the legal heirs of the said W. P. A. R. Ramamurthy informed the petitioner that there were arrears of agricultural income-tax to the tune of nearly Rs. 1,11,000 and they have already written a letter to the Department on September 30, 1985, to attach the amount of Rs. 1,27,000 lying to the credit of O. S. No. 717 of 1979 and further informed the petitioner that the Department would have taken necessary action based on the said lette ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . No. 141 of 1984 at Sub-Court, Dindigul, in O. S. No. 717 of 1978 to attach the deposit amount. Since the other creditors have taken steps to claim the court deposit, the efforts of the Department to realise the arrears have not fructified. Therefore, simultaneously, a notice under the Revenue Recovery Act was issued to the court auction purchaser to realise the Government dues at the earliest. It is also stated that the petitioner has purchased the entire lands when the assessee was alive. Therefore, the authority has rightly acted under section 23 of the Act. Hence, the pendency of any suit before the Sub-Court, Dindigul, and consequences resulting out of the said proceedings do not preclude the statutory authority to proceed against the transferee in possession and enjoyment of lands in respect of which agricultural income-tax is due to the exchequer. With these averments, they prayed for dismissal of the writ petition. In the light of the above pleadings, I have heard learned counsel for the petitioner as well as the learned special Government pleader for respondents. Mr. G. Rajagopalan, learned counsel for the petitioner, has raised the following contentions : (i) Sec ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... have taken steps before the Sub-Court, Dindigul, in order to realise the agricultural income-tax dues. However, it is the definite case of the respondents that in spite of taking sincere efforts, they could not get the money in view of the other creditors and even otherwise as per section 23 of the said Act, they are entitled to proceed against the transferee with regard to agricultural income-tax payable by the transferor. In the light of the above factual position, now I shall consider the contention made by both sides. According to Mr. G. Rajagopalan, learned counsel for the petitioner, section 23 of the Tamil Nadu Agricultural Income-tax Act, 1955 (hereinafter referred to as "the Act"), would not apply to court auction sales. Section 23 of the Act is as follows : "23. Assessment in case of transfer of right in land.---Where a person in receipt of agricultural income from any land in the State is found to have transferred his interest in such land to another person, the transferor and the transferee shall each be assessed in respect of his actual share, if any, of such agricultural income : Provided that when the transferor cannot be found, the assessment of such agricult ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e to the State are entitled to priority over all other debts. If a decree holder brings a judgment-debtor's property to sale and the sale proceeds are lying in deposit in court, the State may, even without prior attachment exercise its right to priority by making an application to the executing court for payment out. If, however, the State does not choose to apply to the court for payment of its dues from the amount lying in deposit in the court but allows the amount to be taken away by some other attaching decree holder, the State cannot, thereafter make an application for payment of its dues from the sale proceeds since there is no amount left with the court to be paid to the-State. However, if the State had already effected an attachment of the property which was sold even before its sale, the State would be entitled to recover the sale proceeds from whoever has received the amount from the court by filing a suit. Section 73(3) read with section 73(2) of the Civil Procedure Code, contemplates such a relief being granted in a suit. . ." He also relied on a Division Bench decision of this court in Punjab National Bank, v. Jaggi Brothers [1995] 2 LW 569 wherein it is stated as fo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... for arrears of tax in certain cases would go to show that the respondents are entitled to a first charge among all other debts. In view of the language used in section 23 coupled with other sections and in view of the fact that the Government gets priority in recovering its debts, I am unable to accept the argument of learned counsel for the petitioner, namely, that section 23 of the Act would not apply to court auction purchase. In the absence of any restriction in section 23 of the Act, it cannot be construed that the same is not applicable when someone purchased the property through court auction irrespective of section 65 of the Civil Procedure Code. Even on the date of purchase through court auction, a charge was created on the lands towards agricultural income-tax due. The transferee of the lands subjected to charge created thereon for agricultural income-tax arrears is liable to pay the tax dues. Since the tax is payable with reference to the lands, the petitioner and the firm having purchased the same irrespective of the fact that the respondents did not take appropriate steps when the amount was lying before the Sub-Court in the light of unfettered provision, namely, sect ..... X X X X Extracts X X X X X X X X Extracts X X X X
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