1964 (11) TMI 8 - SUPREME COURT

Whether respondent No. 1, the Union of India, is entitled to claim that the tax due to it from respondent No. 2, M/s. R. K. Das and Co., on account of the assessment years 1946-47 and 1947-48 has priority and precedence over the decretal amount due to the appellant, M/s. Builders Supply Corporation, from respondent No. 2?

Held that:- It is difficult to accept the argument that the application of the doctrine of priority of arrears of tax over private debts can be said to be displaced by any of the provisions of the Recovery Act. The High Court was right in coming to the conclusion that respondent No. 1 was entitled to claim priorty in the matter of arrears of tax due from respondent No. 2 over the decretal debt due to the appellant from the same debtor. Appeal dismissed.