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TMI Blog2019 (8) TMI 1290X X X X Extracts X X X X X X X X Extracts X X X X ..... 9; for brevity) provisionally attaching said property to secure for what according to the impugned order is arrears of tax and penalty to the tune of over 11.72 Crores (Rs. 11,72,51,886/- to be precise) under 'Pondicherry General Sales Tax Act' ('PGST Act) and 'Pondicherry Value Added Tax Act' ('PVAT Act' for brevity). 3. According to the impugned order, this arrears of tax and penalty under PGST and PVAT Acts are dues of a dealer in petroleum products being Sri Manakula Vinayagar Petro Agency with 'Tax Identification Number' ('TIN' for brevity) 34070001928. A reading of the impugned order also reveals that Sri Manakula Vinayagar Petroleum Agency is a proprietary concern and Tmt.D.Indira (petitioner's aforementioned vendor D.Sundar's mother) is the sole proprietrix. 4.Instant writ petition has been filed by D.Sundar's vendee who purchased said property under aforementioned registered Sale Deed dated 03.07.2017. Challenge to the impugned order, as can be culled out from the averments /grounds /contentions in the affidavit filed in support of the writ petition has been captured by this Court in earlier proceedings dated 03.07 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rned counsel for writ petitioner submitted that attachment if any, can only be for liability of a 'dealer' within the meaning of PVAT Act. It was submitted by learned counsel for writ petitioner that writ petitioner's vendor is not a dealer and even according to 'impugned order', the dealer is one Tmt.D.Indira and she has been carrying on business as a sole Proprietrix in the name and style 'Manakula Vinayagar Petro Agency, Pudhcuerry' (to be noted Tmt.D.Indira is mother of vendor Mr.D.Sundar). 9. By way of preliminary submissions, learned AGP, drawing the attention of this Court to Section 37 of PVAT Act submitted that tax liability under the said Act i.e., PVAT Act, becomes first charge on the property of the dealer, on 21 days elapsing from the date on which notice of tax assessment is served on the dealer. 10. This takes us to the question as to whether the vendor of writ petitioner can be described as a dealer under PVAT Act. 11. To be noted, the term 'dealer' is a term of art qua PVAT Act as it has been defined under Section 2(n) of PVAT Act. 12. These proceedings have been captured and recorded for narrowing down issues that fall f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rs of 'Sri Manakula Vinayagar Petro Agency'. To be noted, learned State counsel has filed a detailed counter affidavit dated 11.07.2019 and also typed-set of papers along with the same. 7. Learned State counsel first drew the attention of this Court to Section 37 of PVAT Act and submitted that in the instant case on 21 days elapsing from the date of assessment under PVAT Act, the outstanding amount i.e., arrears of tax becomes a first charge on said property. For the purpose of convenience and clarity, this Court deems it appropriate to extract subsections (1) and (2) of Section 37 and provisos thereto, which reads as follows: '37.Payment and recovery of tax__(1) The tax assessed under this Act shall be paid in such manner and in such instalments, if any and within such time as may be specified in the notice of assessment, not being less than twenty-one days from the date of service of the notice. If default is made in paying according to the notice of assessment, the whole of the amount outstanding on date of default shall become immediately due and shall be a first charge on the properties of the dealer liable to pay the tax under this Act. (2) Where during the p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... m or company or association situated outside the Union Territory and a non-resident dealer or an agent of a non-resident dealer; (v) a person who sells goods produced by him by manufacture or otherwise; (vi) a person engaged in the business of transfer, otherwise than in pursuance of a contract, of property in any goods for cash, deferred payment or other valuable consideration; (vii) a person engaged in the business of transfer of property in goods (whether as goods or in some other form) involved in the execution of a works contract; (viii) a person engaged in the business of delivery of goods on hire-purchase or any system of payment by instalments; (ix) a person engaged in the business of transfer of the right to use any goods for any purpose (whether or not for a specified period) for cash, deferred payment or other valuable consideration; (x) a person engaged in the business of supplying by way of or as part of any service or in any other manner whatsoever, of goods, being food or any other article for human consumption or any drink (whether or not intoxicating), where such supply or service is for cash, deferred payment or other valuable consideration; (xi) a s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ubmission of learned senior counsel that the expression 'or otherwise' does not qualify how the business was carried on, but it qualifies the list of four business activities enumerated in Section 2(n). Elaborating his submission in this direction, it was also submitted by learned senior counsel that 'any person' occurring in Section 2(n) is fixed i.e., writ petitioner's vendor's mother and it makes no difference as to whether she was carrying on business directly or otherwise i.e., through her son. It was submitted by way of illustration that it may even be a manager or cashier in the petroleum dealership outlet. 13. Per contra, learned State counsel submitted that 'any person' occurring in Section 2(n) is not fixed as there is copious material to show that writ petitioner's vendor was only carrying on day-to-day affairs of Sri Manakula Vinayagar Petro Agency. To be noted such material forms part of respondents' typed-set and they remain unrefuted. 'Any person' in Section 2(n) should be read as writ petitioner's vendor, who was carrying on business not directly, but otherwise. 14. Therefore, the lone question has further narro ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the other is expression 'or otherwise' occurring in Section 2(n) of PVAT Act. 19. With regard to 'any person' occurring in Section 2(n), in the considered view of this Court, the legislature in its wisdom has chosen to say 'any person' and not 'a person'. Therefore, intention was to take within its sweep different kinds of persons. In this view of the matter, this Court is unable to accept the submission that 'any person' is static and that it can refer only to writ petitioner's vendor's mother in this case. Another reason as to why this Court is unable to accept this contention is, PVAT Act does not stop with defining 'dealer'. It defines 'registered dealer' also. To be noted, 'registered dealer' is defined in Section 2(zc) of PVAT Act. Section 2(zc), which defines a 'registered dealer', reads as follows: '2(zc) "registered dealer' means a dealer registered under this Act.' 20. Therefore, a conjoint reading of 'dealer' and 'registered dealer' makes it clear that 'dealer' can be any person who carries on four kinds of business activities set out in Section 2(n), b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ring in Explanation (a) to Section 6 of Bombay Land Requisition Act, 1948. Portions of Section 6 of said Act including Explanation (a) as extracted in the copy of Lila Vati Bai judgment placed before this Court reads as follows: '6.(1) If any premises situate in ail area specified by the State Government by notification in the Official Gazette, are vacant on the date of such notification and wherever any such premises are vacant or become vacant after such date by reason of the landlord, the tenant or the sub-tenant, as the case may be, ceasing to occupy the premises or by reason of the release of the premises from requisition or by reason of the premises being newly erected or reconstructed or for any other reason the landlord of such premises shall give intimation thereof in the prescribed form to an officer authorised in this behalf by the State Government. ........................................................................... (4) Whether or not an intimation under sub-section (1)is given and notwithstanding anything contained in section 5, the State Government may by order in writing- (a) requisition the premises for the purpose of the State or any other public ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 3) 1 Ch 413 (K) where the words 'or otherwise' used in Section 32 of the erstwhile Patents, Designs and Trade Marks Act, 1883 in England were interpreted in Skinner & Co. case. 26. In the instant case, with regard to generic words 'or otherwise' which we are concerned with, this Court has no hesitation in holding that Lila Vati Bai principle, being a Constitutional Bench judgment of Hon'ble Supreme Court, can be applied as these generic words used in Explanation (a) to Section 6 of Bombay Land Requisition Act and Section 2 (n) of PVAT Act are not different. It is nobody's case that deployment of these generic words are different in Explanation (a) to Section 6 of said Act and Section 2(n) of PVAT Act. 27. This takes us to the question as to whether the expression 'or otherwise' is an extension for directly i.e., an extension for the manner in which business is carried on or extension to the kinds of business activities. As already mentioned supra, four kinds of business activities are adumbrated in Section 2(n) and they are buying, selling, supplying or distributing. This Court is unable to accept the argument of learned senior counsel for writ pet ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he business activities, namely buying, selling and distributing petroleum products indirectly through her son. 31. Therefore, this Court having come to the conclusion that writ petitioner is carrying on business as a dealer not directly, but otherwise, even on an extreme demurrer, even if the expression 'or otherwise' is to be given a restricted meaning, it will still cover writ petitioner's vendor. As already alluded to supra, this is because the term 'registered dealer' has been defined separately and writ petitioner's vendor's mother will qualify as 'registered dealer'. This Court is of the considered view that the width given to the term 'dealer' while defining the same is to eliminate the mischief of a person/entity carrying on some business without registering himself, herself or itself as a dealer and then getting away with it qua tax liability by saying that he is not a dealer under PVAT Act. 32. To borrow from Zoology, if 'dealer' is a family, 'registered dealer' is a species considering the definitions in Section 2(n) and Section 2(zc). As far as adumbration of 13 categories under Section 2(n) is concerned, it ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... endor for having palmed off a property, which was subject matter of first charge under Section 37(1) of TNVAT Act. There is no material placed before this Court to demonstrate that writ petitioner has issued any notice or initiated any proceedings against his vendor. If the writ petitioner now chooses to proceed against his vendor, this order will not impede such proceedings. 37. One other aspect of the matter is regarding communication to the jurisdictional Registrar's office about first charge on properties of a dealer when the same occurs under Section 37(1) of PVAT Act. Learned State counsel submits that as of now, there is no procedure to communicate such a charge when it occurs. This Court deems it pertinent to set out, obviously in a recommendatory tone that it would be appropriate for the Government to consider making Rules in this regard. This Court also notices that Rule making power has been vested in the Government under Section 27(1) of TNVAT Act. This Court also deems it appropriate to mention that 'Attachment Before Judgment' ('ABJ' for brevity) orders made under Order XXXVIII Rule 5 of 'The Code of Civil Procedure, 1908' ('CPC' ..... X X X X Extracts X X X X X X X X Extracts X X X X
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