TMI Blog2016 (2) TMI 857X X X X Extracts X X X X X X X X Extracts X X X X ..... he taxes in relation to the property. The sales tax dues of the company in liquidation for the year 1988 cannot be termed as the taxes in relation to the property. Further, when the respondent No.2 has already lodged its claim before the respondent No.1 – Official Liquidator in the year 1995, the same would be considered by the Official Liquidator as per the provision of Section 530 of the Companies Act and therefore the charge created by the respondent No.2 in respect of the land of the company in liquidation is required to be removed and the concerned revenue authority is required to make necessary entries in the revenue record entering the name of the applicant No.1 as purchaser of the land of the company in liquidation. Hence, the Mamlatdar, Anand is hereby directed to cancel the entry registering the so-called charge of Sales Tax Department as arrears of land revenue to ensure that the applicant No.1 gets free and clear marketable title qua the property of the company in liquidation purchased vide order dated 06.05.2004 passed in O.L.R. No. 22 of 2004 - COMPANY APPLICATION NO. 193 of 2014, OFFICIAL LIQUDATOR REPORT NO. 22 of 2004 - - - Dated:- 29-7-2015 - MR. VIPUL M. PA ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 77; 1,35,000,00/-. This Court passed an order on 06.05.2004 in O.L.R. No.21 of 2004 in Company Petition No.62 of 1991, whereby this Court confirmed the sale of the assets and properties of the company in liquidation in favour of the applicant No.2. Learned advocate referred to the said order produced at page 19 of the compilation. After referring to the said order, learned advocate submitted that the sale of the assets and properties of the company in liquidation was as is where is and whatever there is basis. He submitted that condition No.7 of the said order provides that the purchaser shall pay all the taxes in relation to property levied/leviable by the State Government or any local authority in relation to the company in liquidation. It is hereby abundantly clear that such dues shall include all the outstanding dues. 5. Learned advocate Mr. Shah thereafter submitted that the applicant No.2 made payment of full consideration to the Official Liquidator. As per the permission granted by this Court in the aforesaid order, the applicant No.2 i.e. the successful bidder nominated applicant No.1 company and requested the Official Liquidator to execute a conveyance deed in favour ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he company in liquidation. 8. Learned advocate Mr. Shah thereafter contended that if the sales tax authorities have any claim against the company in liquidation in respect of sales tax dues, they have to prefer their claim before the respondent No.1 i.e. the Official Liquidator of the company in liquidation under the provisions of the Companies Act of 1956. As and when such claims are received by the Official Liquidator of the company in liquidation, the Official Liquidator would consider the same in accordance with the provision of the Companies Act, more particularly, under Section 530 of the Companies Act, 1956. Thus, it is the duty of the Official Liquidator to see that the sales tax authorities withdraw their noting in the 7/12 extract in respect of their claim against the company in liquidation and issue no due certificate to the applicants. Learned advocate vehemently contended that the sales tax is not a charge and does not create a charge on the lands of the person who is liable to pay the sales tax. Such dues does not create any charge on the land of the company in liquidation. The same is to be dealt with as per the provisions of Section 530 and other relevant provisi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... condition Nos. 7 and 8 of the order dated 06.05.2004 passed by this Court in O.L.R. No.22 of 2004 and submitted that as per the said conditions, purchaser shall have to pay all the taxes in relation to the property. She, therefore, submitted that levy of tax/Government taxes and local authorities taxes are required to be paid by the purchaser including the outstanding dues. She, further submitted that as per the said conditions, the applicants have not paid the sales tax dues and therefore charge on the aforesaid lands was not removed. She, therefore, requested that the present application be dismissed. 12. I have considered the arguments canvassed on behalf of the learned advocates for the parties and I have also gone through the documents produced on record and the decisions referred to and relied upon by the learned advocate for the applicants. 13. From the record, it emerges that this Court has passed an order on 22.12.1992 in Company Petition Nos.62 of 1991 to 64 of 1991 by which M/s. Beclawat of India Ltd. was ordered to be wound up. The company in liquidation owned and possessed certain parcels of freehold land at village Karamsad, Taluka Anand. This Court constituted ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in relation to property and whether the said words include the sales tax liability of the company in liquidation or not. Now, it is true that this Court in condition No.7 used the words, The purchaser shall pay all the taxes in relation to property , which as rightly contended by learned advocate Mr. Shah do not include the sales tax liability of the company in liquidation and it only relates to the taxes with regard to the properties of the company in liquidation i.e. the properties which the applicants have purchased in court auction. In other words, the applicants are liable to pay all the taxes relating to the property of the company in liquidation and sales tax cannot be said to be the taxes in relation to property. Moreover, as observed earlier, the applicants have paid full consideration of the property. 16. Now, it would be appropriate to consider the relevant provisions of the Companies Act, 1956. Clause (a) of sub-section (1) of Section 530 of the Companies Act provides that: 530. Preferential payments.- (1) In a winding up [subject to the provisions of section 529A, there shall be paid] in priority to all other debts - (a) all revenues taxes, cesses and r ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... age, it is relevant to note that the Sales Tax Department has already lodged the claim before the Official Liquidator in the year 1995. The Official Liquidator would consider the same in accordance with the provisions of Section 530 of the Companies Act. 19. Thus, merely because this Court has observed in condition No.7 of the terms and conditions that the purchaser is required to pay all the taxes in relation to the property levied/leviable by the State Government or any local authority in relation to the company in liquidation, it does not mean that preferential payment from the sale proceeds be made to any Government Authority or any local authority over the other secured creditors, workers, etc. of the company in liquidation in contravention to the provisions of Section 530 of the Companies Act, 1956. Moreover, as observed above, as per the condition No.7 of the aforesaid order, the purchaser is required to pay all the taxes in relation to property and sales-tax is not the taxes in relation to the property. 20. This Court, vide order dated 28.01.2010 in Company Application No.464 of 2009, observed and held in para 4, 5 and 6 as under: 4. Learned Assistant Government ..... X X X X Extracts X X X X X X X X Extracts X X X X
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