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2015 (6) TMI 183 - HC - Income TaxRecovery of tax due without issuing notice u/s 156 - Challenge to prohibitory orders and warrant of attachment of moveable property - whether any recovery proceedings can be initiated against the writ petitioner for the alleged income tax dues as claimed by the Revenue - carrying on business on behalf of the State of Telangana in respect of sale of Indian Made Liquor and Foreign Liquor - restraining the petitioner from selling the liquor stock, which is the property of State of Telangana Held that:- By virtue of Section 68 read with Section 53 of Act, 2014, successor States of Andhra Pradesh and Telangana have acquired the assets and took over the liability in respect of the Companies and Corporations specified in the ninth schedule of Act, 2014. By virtue of sub-section (2) of Section 68 the assets, rights and liabilities of APBCL now stand apportioned between the State of Andhra Pradesh and State of Telangana in the manner as provided in Section 53 of Act, 2014. Section 53 provides subject to the agreement the aforesaid assets and liabilities of the Corporation, shall stand apportioned on the basis of population ratio. The petitioner has not acquired nor can acquire in view of above legal position any property from APBCL nor the liability thereof. The State of Telangana has acquired these assets and properties and liability of APBCL, being the recorded assessee proportionately. Therefore, it is absurd to contend that the writ petitioner is the successor in interest of APBCL. It does not appear from object clause of Memorandum of Association that it has acquired any rights, assets and properties of APBCL. Thus, the question of shouldering liability by the writ petitioner also does not arise. We are of the view that just because the petitioner paid tax dues on mistaken application of law, it cannot be precedent for recovery for the simple reason that illegal and wrongful action cannot be precedent, furthermore there cannot be estoppel as against provision of law. - actions taken by the Revenue against the writ petitioner are without jurisdiction and wholly illegal. In the event, State of Telangana does not pay the proportionate liability of the tax dues for the assessment year 2012-13 or previous thereto, if any, it would be open for the respondents to recover the same from the State of Telangana, since It is to share the proportionate liability along with assets of the erstwhile APBCL which was again a separate legal entity and an assessee. We are of the view that the writ petitioner cannot be equated with the Government in order to get Constitutional immunity from payment of taxes. - Decided in favour of appellant.
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