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TMI Blog2008 (8) TMI 860X X X X Extracts X X X X X X X X Extracts X X X X ..... t be proceeded against in recovery proceedings. However, the case of the respondent is that defaulter transferred the property on January 20, 1994 to his wife to avoid recovery of sales tax and the defaulter's wife in turn sold the property to petitioner. Therefore, property can be attached and sold in recovery proceedings by virtue of section 26A of the Kerala General Sales Tax Act, 1963 is the case of the respondent. The learned counsel for the petitioner referred to decision of the Supreme Court in State of Karnataka v. Shreyas Papers (P) Ltd. reported in [2006] 144 STC 331; [2006] 1 SCC 615 and contended that sales tax is not a charge on the property and so much so recovery cannot be continued against the property. The learned Gove ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... who is the defaulter in this case, was admittedly a registered dealer under the KGST Act and his assessment was pending based on monthly returns filed during 1993-94 as on the date of effecting sale of the property by him to his wife on January 20, 1994. Therefore, obviously sale of the property effected by defaulter to his wife on January 20, 1994 can be ignored and property can be attached and sold in recovery proceedings for recovery of arrears of sales tax due from the defaulter. Since the seller did not have a valid title by virtue of operation of section 26A, sale of the property by defaulter's wife to petitioner also does not confer valid title or in other words, title conferred is subject to tax liability in terms of section 26A ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ously or indifferently entered into the transaction and he has no escape from the consequences. The next contention raised by learned counsel for the petitioner is that petitioner is willing to pay the market value, which is reflected in the sale price of neighbouring property in recovery proceedings. The learned counsel submitted that 1.66 acres was sold in recovery proceedings on May 21, 2002 for Rs. 1,26,500. I do not want to comment about the propriety or legality of this transaction because it is for the aggrieved person to challenge the sale or the higher authorities under RR Act to interfere, if required. However, since petitioner has put up an industry and is running it there, I feel petitioner's case calls for consideration. I ..... X X X X Extracts X X X X X X X X Extracts X X X X
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