TMI Blog2011 (12) TMI 687X X X X Extracts X X X X X X X X Extracts X X X X ..... ed as person succeeding the business or trade of predecessor. He further submitted that it is only in the case of transfer of ownership of running business, all existing liability of the predecessor could have been fastened upon the purchaser, not otherwise. 3. It is further averred that the petitioner purchased the property of M/s. Pinkcity Leminart (P) Ltd. in pursuance of advertisement issued for auction of property of M/s. Pinkcity Leminart (P) Ltd., which was conducted on 21-2-2005. The petitioner was the highest bidder and paid sale consideration of ₹ 34,51,000/- to Rajasthan Financial Corporation on 28-3-2005; Deed of Conveyance was registered at the office of Sub-Registrar, Kekri, District Ajmer. Respondent No. 3 issued recovery notice dated 17-3-2006 in which it was mentioned that a sum of ₹ 4,60,000/- along with interest was due from M/s. Pinkcity Leminart and as per decisions rendered by Hon ble Apex Court in M/s. Macson Marbles P. Ltd. v. Union of India, [2003 (158) E.L.T. 424 (S.C.)] and Dena Bank v. Bhikabhai Prabhudas Parekh Co. and Others, [(2000) 5 SCC 694], the successor is liable to pay the dues of the predecessor. Repeatedly, recovery notices ha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 8) E.L.T. 424 (S.C.) and Dena Bank v. Bhikhabhai Prabhudas Parekh Co. and Others, (2000) 5 SCC 694. 8. Section 11 of the Act of 1944 provides for recovery of sums due to Government by attachment and sale of excisable goods belonging to such person; and if the amount payable is not so recovered, the concerned officer may prepare a certificate signed by him specifying the amount due from the person liable to pay the same and send it to the Collector of the district in which such person resides or conducts his business. In case a person, from whom duty or any other amount is due, transfers or otherwise disposes of his business or trade in whole or in part, or effects any change in the ownership thereof, the proviso added to Section 11 of the Act of 1944 makes it clear that all excisable goods, materials, preparations, plants, machineries, vessels, utensils, implements and articles in the custody or possession of the person so succeeding may also be attached and sold by such officer empowered by the Central Board of Excise and Customs. 9. Provisions of Section 11 of the Act of 1944 and Rule 230(2) of the Central Excise Rules clearly provide for mode of recovery of the excise du ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... over the Central Excise Act. Each of them is a special enactment and unless in the operation of the same any conflict arises this aspect need not be examined. In this case no such conflict arises between the corporation and the Excise Department. Hence it is unnecessary to examine this aspect of the matter. 10. In Dena Bank s case (supra), Hon ble Apex Court held that Crown s preferential right to recovery of debts over other creditors is confined to ordinary or unsecured creditors. The scope of Karnataka Sales Tax Act, 1957 was also considered by the Hon ble Apex Court in Para Nos. 10, 15 and 19, which read thus :- 10. However, the Crown s preferential right to recovery of debts over other creditors is confined to ordinary or unsecured creditors. The common law of England or the principles of equity and good conscience (as applicable to India) do not accord the Crown a preferential right for recovery of its debts over a mortgagee or pledgee of goods or a secured creditor. It is only in cases where the Crown s right and that of the subject meet at one and the same time that the Crown is in general preferred. Where the right of the subject is complete and perfect before that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... oever including in respect of mortgage. Section 158 of the Karnataka Land Revenue Act not only gives a statutory recognition to the doctrine of the State s priority for recovery of debts but also extends its applicability over private debts forming the subject-matter of mortgage, judgment-decree, execution or attachment and the like. In Collector of Aurangabad v. Central Bank of India the provisions of the Hyderabad Land Revenue Act and the Hyderabad General Sales Tax Act had come up for consideration of this Court. This Court had refused to grant primacy to the dues on account of sales tax over secured debt in favour of the Bank. A perusal of the relevant statutory provisions quoted in the judgment goes to show that any provision pari materia with the one contained in Section 158 of the Karnataka Land Revenue Act was not to be found in any of the local Acts under consideration of this Court in Collector of Aurangabad v. Central Bank of India. The effect of Section 190 is to make the procedure for recovery of arrears of land revenue applicable for recovery of sales tax arrears. The effect of Section 158 is to accord a primacy to all the moneys recoverable under Chapter XIV, which w ..... X X X X Extracts X X X X X X X X Extracts X X X X
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