TMI Blog1998 (12) TMI 603X X X X Extracts X X X X X X X X Extracts X X X X ..... the defendants, objecting to the attachment. The plaintiff is not liable to pay any sales tax and the attachment is also illegal. Hence, the suit. 3.. The defendants resisted the suit, stating that the suit properties were attached to the sales tax arrears due from Malayan Chettiar. He was an assessee, having been assessed for sales tax from 1957-58. The tax for the year 1957 to 1963 still remains unpaid. The property has been transferred subsequently to the accrual of the sales tax and, as such, there is a statutory charge on the properties. All the subsequent transfers are only subject to the charge. The subsequent transfer, viz., in favour of Govindasamy Chettiar, Dhanalakshmi Ammal and the plaintiff will not confer any absolute title. They are entitled to recover the arrears by proceedings under the Revenue Recovery Act. 4.. The trial court framed six issues and on behalf of the plaintiff, exhibits Al to A40 were marked and P.W.1 was examined. On the side of the defendants exhibits B1 and B2 were marked and D.W.1 was examined. The trial court dismissed the suit and aggrieved against this, the plaintiff filed A.S.18/85 on the file of subcourt, Salem and the appeal was a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the relief claimed by him. A number of documents have been filed on the side of the plaintiff to show that the properties have changed hands from Malayan Chettiar even in August, 1962. It is, therefore, evidently clear that Malayan Chettiar and his wife had conveyed the property on August 31, 1962, i.e., only after the provisional assessment demand as well as the final order passed by the sales tax authorities. Exhibit B2, the final assessment order, is dated May 26, 1962 and only within the period of three months, the property has been conveyed by Malayan Chettiar. 9.. The learned counsel for the defendants contended that there will be a statutory charge relating to the property of the assessee and any sale of the property by the assessee would be subject to the payment of sales tax amount. According to exhibit B1 the sales tax amount was Rs. 540 and in the final assessment order exhibit B2 the tax arrears came to Rs. 1,390.52. However, the demand notice under exhibit A.36 dated August 18, 1982 disclosed that a sum of Rs. 61,616.70 has been claimed by way of tax arrears as well as penalty. The learned counsel for the plaintiff contended that no particulars were furnished by the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y to the assessing authority or for which he is personally liable to the assessing authority under this section shall, if it remains unpaid, be a charge on the properties of the said person and may be recovered as if it were an arrear of land revenue." 12.. It is evidently clear from the language employed under section 24(2) of the said Act that any tax assessed or has become payable or any other amount due under this Act, will have priority over the claims against the property of the said dealer or person and the same may be recovered. It, therefore contemplates that the arrears of sales tax payable if any, will have priority over all other claims except those two categories mentioned in sub-clause (2) and this being so, prima facie, it is clear that any alienation of the property made on and after the assessment of the sales tax would not be valid unless and until the sales tax amount due and payable is cleared. The contention of the plaintiff that the amount claimed is excessive and other matters are to be agitated before the sales tax forum and this cannot be gone into in the present suit filed by him to set aside the attachment order. 13.. The learned counsel for the defen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ch of this Court has held that under section 24(2) of the TNGST Act a charge was created over the properties for the sales tax amount due by the transferor even before the transfer was actually effected and the said charge can be enforced against the properties transferred, which are in the hands of the transferee. Thus, even if the transferee is not taken to be a defaulter, the properties in his hands can be proceeded against under the provisions of the Revenue Recovery Act, in view of the statutory provisions in section 24(1) read with section 24(2). This decision is exactly applicable to the case on hand. 18.. Reliance was also placed in an unreported judgment in the case of Central Bank of India v. State of Tamil Nadu (W.A. No. 981 of 1989 dated August 29, 1997) by the learned counsel for the defendants. In this case, reliance was placed on the case of State Bank of Bikaner Jaipur v. National Iron Steel Rolling Corporation [1995] 96 STC 612 (SC) and it is a decision under the Rajasthan Sales Tax Act. The learned counsel for the plaintiff pointed out that there is a provision under the Rajasthan Sales Tax Act creating a first charge on the property of the dealer and simila ..... X X X X Extracts X X X X X X X X Extracts X X X X
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