TMI Blog1986 (1) TMI 27X X X X Extracts X X X X X X X X Extracts X X X X ..... ereof. We shall, at the outset, set out the relevant brief facts. The properties originally belonged to one A. P. Ramaswamy Gounder. He was an assessee to agricultural income-tax. Demands made for payment of the tax to the extent of Rs. 30,563.29 remained unresponded to and the dues thus remained unpaid. The machinery for recovery under the Revenue Recovery Act was thereupon set in motion. A notice under section 34 of the Revenue Recovery Act dated October 18, 1971, was served on the defaulter on November 8, 1971. There was no reaction from the defaulter even to that notice. A notice under section 36 attaching the property was issued on June 22, 1972. The property was notified for sale under section 49, the notification having been published in the Gazette dated June 26, 1973. The sale was initially posted on August 7, 1973, but was adjourned to August 27, 1973, due to want of bidders. It was again postponed for the same reason and on September 24, 1973, the Government purchased the property under section 50 of the Act. The petitioner in O.P. No. 2929 of 1979, who is the husband of the petitioner in the connected case, O.P. No. 2925 of 1979, had participated in the auctions held ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... "Any engagement entered into by the defaulter in respect of a property in question, after the service of demand notice is not binding on the Government under section 44 of the Revenue Recovery Act." The petitioners have not challenged the., correctness of the factual details referred to in the counter-affidavit. Confronted with such a contention, counsel for the writ petitioners urged an extreme and in a sense a novel-contention that the term Of engagement " occurring in section 44(1) will not take in a regular contract of sale and that the term is intended to cover transactions other than transfers as they are ordinarily known. Novelty of an argument is no reason to condemn it outright as observed by Lord Roskill in Home Office v. Harman [1982] 1 All ER 532, 550 (HL). This pointed contention has not been dealt with as such by the learned judge. In the appeal, it has been complained that the learned judge had not adverted to the statements in the counter-affidavit and arguments advanced in that behalf. We find force in those submissions. The question about invalidity of the private sale in the light of section 44 of the Act, clearly pleaded in the counter-affidavit of the State ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y implementation of the projects and policies of the Government, including the welfare measures and benevolent activities undertaken by welfare State. The snail-slow process of realisation of overdue payments by resort to conventional litigation with its notorious tardy pace is doomed to failure, having regard to the objective of immediate realisation of public dues. It, therefore, stands to reason that the State Government is armed with an extraordinary remedy which would expedite realisation of public revenue. This is based on public policies and is conceived in larger public interest. Certain public revenues are charged on land. Some others are not. Quite often, substantial amounts due by way of public revenue partake of the character of dues in respect of which there is no charge on the property of the defaulter. He who defaults in payment of public revenue is ordinarily likely to be aware of the aftermath and the unsavoury consequences of the State's attempt at realisation of such dues. It is understandable human nature that such a defaulter may attempt to salvage for himself, properties which may otherwise be proceeded against, and if need be, sold in public auction. It is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n Council [1914] 22 IC 107; AIR 1914 Mad 174. The Division Bench of the Madras High Court consisting of Ayling and Sadasiva Aiyar JJ. ruled that the term " engagement " was more comprehensive than a contract or premise. The view of the court is lucidly expressed in the following words (p. 119 of IC): " The Legislature has evidently used the comprehensive word 'engagement' instead of the word 'agreement' or 'contract' in order that implied undertakings (based on equitable considerations) made by Government and not merely the ordinary contracts based on regular deeds signed by parties or arising out of formal proposals and acceptances made orally or to be gathered from correspondence might be relied on by landlords, proprietors and Inamdars in support of their claims for exemption from water-cess. " We are in respectful agreement with the elucidation of the concept of It engagement " as given by the aforesaid decision. We are further fortified in our conclusion by the legislative description of the term " engagement " as attempted when the Travancore Cochin State enacted the Revenue Recovery Act of 1951. The latter portion of section 32 of that enactment reads : "........ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... c dues could be the basic tax which is a principal source of revenue covered by the enactment. It could be other types of revenue deemed as public revenue under this enactment such as the sales tax or the agricultural income-tax. (Under section 23 of the Kerala General Sales Tax Act, 1963, sales tax remaining unpaid after a demand under that enactment gets transmuted into an arrear of public revenue. That is the position with regard to the agricultural income-tax by virtue of section 41 of the Act.) The situation which prevails immediately after the public revenue becomes due is covered by section 44(2). The situation is one in which the liability for payment of public revenue has crystallised itself. If, at that juncture, a transfer of the property of the defaulter is effected, that is nullified by statutory provision ; the process of nullification, however, would be operative only in a limited contingency, namely, when the transaction is effected with an intent to defeat or delay the payment of revenue. This requirement (of establishing an intent to delay or defeat the payment of public revenue) is important and would ordinarily cast none-too-insignificant burden on the State. Th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssarily to be upheld in the above circumstances. We do so. This will necessarily entail the dismissal of the original petitions to the extent they seek invalidation of the revenue sale. In the light of our above conclusion, it has become unnecessary to discuss the further question about the ineffectiveness of the sales in favour of the writ petitioners after the property had been attached in pursuance of the revenue recovery proceedings taken against the defaulter. It has become equally unnecessary in that context to consider the question whether the revenue sales held in 1973 could be assailed by the writ petitioners by moving this court in the year 1979. When the petitioners cannot base their claims to the property on any valid or legal title, it will only be a wasteful and futile exercise for the Government to formally consider and dispose of the highly belated petitions, exhibits Nos. P-1 and P-2 of 1976. We would decline the prayer for a writ of mandamus in the above circumstances. In the light of the above discussion, the writ appeals would stand allowed and the original petitions would stand dismissed. We do not, however, make any order as to costs. - - TaxTMI - ..... X X X X Extracts X X X X X X X X Extracts X X X X
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