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TMI Blog2019 (9) TMI 216X X X X Extracts X X X X X X X X Extracts X X X X ..... y the Commercial Tax Officer (6), Gjatak-5, Ahmedabad, which was intimated to the petitioner vide communication dated 21/7/2016 (Annexure-A collectively). 2.00. As per the case of the petitioner, the petitioner is owner of the aforesaid residential property in question from one Mr.Indravijaysinh Chauhan by way of a registered sale deed on 8/2/2016. The said residential property was originally belonged to Mrs.Bhavnaben Patel, who happens to be the mother of the petitioner. The mother of the petitioner sold the said bungalow by way of registered sale deed on 26/12/2014 to one Mr.Jayram Bharwad and Mr.Suresh Bharwad, who had in turn sold the property to the seller of the petitioner. As per the case of the petitioner, the petitioner purchased the said residential property after verifying the title of the property and after issuing public notice on 19/12/2015 in two local news papers. According to the petitioner one objection was received in response to the public notice, however, an amicable settlement had arrived at with the said objector - Mr.Bhisambhai Jangiram Ramani. According to the petitioner, the petitioner thereafter has purchased the said residential property by way of regi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... competent to remove such charge. Thereafter, the petitioner pursue the matter with the respondent authorities by making communications dated 21/11/2016, 6/12/2016 and 20/6/2017. However, the respondent authorities neither responded the representations made by the petitioner nor have they withdrawn the charge and attachment on the residential property of the petitioner. Hence, this petition. 3.00. Mr.Uchit Sheth, learned counsel appearing for the petitioner has vehemently contended that the petitioner is bonafide purchase, who has purchased the residential proprty in question after making valuable sale consideration from his hard-earned money. He contended that he has purchaed the property by registered sale deed and his name is entered in the records of the society. He further contended that before purchase of the property, even he had given public notice in news papers and had also obtained Title Clearance Certificate from the Advocate and thus, after due verification and due case, he has purchased the property by way of registered sale deed. He further contended that on the date of the purchase of the property by way of registered sale deed, there was no charge over the proper ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r the respondent Nos.1 and 2. She has vehemently contended that the charge has been crated towards the dues to the tune of Rs. 21,28,24,427/- for the A.Ys. 1987-1996, which has been accrued qua Swapnil Plastics and mother of the petitioner was one of the partners in the said Swapnil Plastics. It is contended that the property of the mother of the petitioner Bhavnaben Patel being one of the partners of Swapnil Plastic was attached on 6/3/2003. It is contended that the assessment orders were passed on 16/11/2002 and 5/12/2002 for the A.Ys.1987-1996. She further contended that for the A.Ys. 1987-88, 1988-89 and 1889-90, reassessments were carried out and reassessment orders were passed on 16/11/2002. She further contended that assessment orders dated 16/11/2002 & 5/12/2002 as well as reassessment order dated 16/11/2002 for the A.Ys. 1987-90 were challenged before the appellate authority, however, the same came to be disposed of due to non-payment of the pre-deposit. The said order of the appellate authority dismissing the appeal on the ground of non-payment of pre-deposit was challenged by Bhavnaben and the tribunal remanded the matter back to the first appellate authority for reconsi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... irst charge on property. Notwithstanding anything to the contrary in any law for the time being in force, any amount payable by a dealer or any other person on account of tax, interest or penalty for which he is liable to pay to the Government shall be a first charge on the property of such dealer, or as the case may be, such person." Thus, section 47 of the Act is concerned with a dealer who creates a charge on or parts with the possession by way of sale, mortgage, exchange or any other mode of transfer, after any tax becomes due from him, and when he so does in favour of any other person with the intention of defrauding the government revenue, this provision states that such charge or transfer shall be void as against any claim in respect of any tax or any other sum payable by the dealer. Section 48 of the Act creates first charge on the property of the dealer or any other person from whom tax is due. 5.03. It is required to be noted at this juncture that section 47 of the GVAT Act is similarly worded to section 281 of the Income Tax Act, 1961 and therefore, some of the decisions in relation to the provision of section 281 of the Income Tax Act which hold the field deser ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on of a certificate, and such sale has become absolute, the purchasers right, title and interest shall be deemed to have vested in him from the time when the property is sold, and not from the time when the sale becomes absolute. 11. Investigation by Tax Recovery Officer. (1) Where any claim is preferred to, or any objection is made to the attachment or sale of, any property in execution of a certificate, on the ground that such property is not liable to such attachment or sale, the Tax Recovery Officer shall proceed to investigate the claim or objection : Provided that no such investigation shall be made where the Tax Recovery Officer considers that the claim or objection was designedly or unnecessarily delayed. (2) Where the property to which the claim or objection applies has been advertised for sale, the Tax Recovery Officer ordering the sale may postpone it pending the investigation of the claim or objection, upon such terms as to security or otherwise as the Tax Recovery Officer shall deem fit. (3) The claimant or objector must adduce evidence to show that - (a) (in the case of immovable property) at the date of the service of the notice issued under this Schedule ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... etitioner that because of explicit provisions made under Schedule II and in particular, sub-rule (6) of rule 11 of the Income Tax Act, the civil suit would be permissible and not otherwise, cannot be accepted. 5.08. It is true that there is no explicit provision made under the GVAT Act as is provided under the Second Schedule of the Income Tax Act, however, it is a well settled law that in the event of any dispute in relation to the title of any property, it is the Civil Court which shall have a jurisdiction. This has also been emphatically held and observed by the Apex Court in Tax Recovery Officer v. Gangadhar Viswanath Ranade [1998] 234 ITR 188 (SC) and followed by this Court in the case of Karsanbhai Gandabhai Patel v. Tax Recovery Officer, [2014] 362 ITR 374 (Gujarat) and therefore, there is no reason why the same would have no applicability in the instant case. This Court in the case of Karsanbhai Gandabhai Patel (supra) had an occasion to deal with section 281 of the Income Tax Act and relying on the judgement of the Apex Court in the case of Gangadhar Viswanath Ranade (supra), struck down the order of attachment, by observing thus: "Section 281 of the Act provides cert ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... entered into for adequate consideration and without notice of pendency of such proceedings or without notice of such tax or other sum payable by the assessee. 5.10. This element of the transaction being with adequate consideration and without notice would equally apply to the assessee as well as the transferee. In a given case, it may even be open for the assessee to establish that the transaction was for adequate consideration without notice. In a given case, even if the assessee had notice of the pendency or the outstanding tax or sum payable, the transferee can still take shelter of the transactions having been entered into by him for adequate consideration and without notice. It is, therefore, that the courts have read into this provision the requirement of hearing the transferee also. Quite apart from this, as would be clear from the discussion hereinafter, courts have taken a view that sub-section (1) of section 281 of the Act only provides for the eventuality of the transaction hit by the said provisions as being void. It does not create any machinery for the Revenue authorities to entertain dispute and declare the transaction to be void for which purpose, only a civil sui ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Vadilal Parikh Versus Commercial Tax Officer and others, reported in [2015] 78 VST 19 (Gujarat). 5.15. The issue involved in the present petition is squarely covered by the decision of the Supreme Court in the case of Gangadhar Vishwanath Ranade (supra). 6.00. Applying the ratio of the aforesaid decisions we are of the opinion that the impugned order creating charge over the property of the petitioner does not warrant any interference and the petition is required to be dismissed. However, we found substance in the submission of Mr.Sheth, learned counsel for the petitioner that the respondent authority cannot sell the property without obtaining declaration from the civil court that the transaction of purchase of the property by the petitioner is with an intention to defraud the State revenue. 7.00. In the result, the present petition is rejected. However, the respondent authority is restrained from selling, disposing of or parting with the property of the petitioner in question in any manner, without obtaining declaration from the competent Civil Court that the transaction of purchase of the property by the petitioner is fraudulent and with an intention to defraud the State re ..... X X X X Extracts X X X X X X X X Extracts X X X X
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