IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT : THE HONOURABLE MR. JUSTICE ANTONY DOMINIC MONDAY, THE 1ST NOVEMBER 2010 / 10TH KARTHIKA 1932 WP(C).No. 38294 of 2008(H) --------------------------------------- PETITIONER: ------------------- PARIVARTHANA KURIES PVT.LTD. IRINJALAKUDA VILLAGE, MUKUNDAPURAM TALUK, REPRESENTED BY ITS CHAIRMAN, K.K.SANKARANARAYANAN, S/O.KRISHNAN, AGED 59 YEARS, KOLLARA HOUSE, POOMANGALAM VILLAGE, IRINJALAKUDA. BY ADV. SRI.C.P.PEETHAMBARAN. RESPONDENTS: ------------------------ 1. THE DISTRICT COLLECTOR, THRISSUR. 2. THE REVENUE DIVISIONAL OFFICER, THRISSUR. 3. THE TAHSILDAR, MUKUNDAPURAM TALUK, THRISSUR DISTRICT. 4. THE VILLAGE OFFICER, POOMANGALAM VILLAGE, MUKUNDAPURAM TALUK, THRISSUR. 5. THE SUB INSPECTOR OF POLICE, KATTOOR POLICE STATION, THRISSUR DISTRICT. 6. SHANI LINSON, W/O.LINSON, THANIYATH HOUSE, ARIPALAM P.O., POOMANGALAM, MUKUNDAPURAM TALUK, THRISSUR DISTRICT. R1 TO R5 BY GOVT. PLEADER SRI. T.K. ARAVINDKUMAR BABU, R6 BY ADVS. SRI.V.M.KRISHNAKUMAR, SMT.P.A.ANITHA. THIS WRIT PETITION (CIVIL) HAVING BEEN FINALLY HEARD ON 01/11/2010,ALONG WITH W.P.(C). NO. 34198/2009, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: W.P.(C). NO.38294/2008-H: APPENDIX PETITIONERS' EXHIBITS: EXT.P.1: COPY OF THE DELIVERY RECEIPT WITH REPORT OF AMEEN DTD. 29/06/2006. EXT.P.2: COPY OF THE ENCUMBRANCE CERTIFICATE. EXT.P.3: COPY OF THE REPLY DT. 10/07/2008 ISSUED BY THE R.3. EXT.P.4: COPY OF THE REPRESENTATION DTD. 31/07/2008 OF THE PETITIONER BEFORE THE R.2. EXT.P.5: COPY OF THE A.D. CARD. EXT.P.6: COPY OF THE JUDGMENT DTD. 06/11/2007 IN W.P.(C).NO.18589/2007 OF THIS HONOURABLE COURT. EXT.P.7: COPY OF THE APPLICATION SUBMITTED BY THE PETITIONER'S COUNSEL DTD. 03/01/2009 UNDER RIGHT TO INFORMATION ACT TO THE R.3. EXT.P.8: COPY OF THE REPLY GIVEN BY THE R.3. TO THE ABOVE DTD. 24/1/2009. EXT.P.9: COPY OF THE APPLICATION DTD. 10/01/2009 SUBMITTED BY THE PETITIONER'S COUNSEL UNDER RIGHT TO INFORMATION ACT TO THE R.2. EXT.P.10: COPY OF THE REPLY TO THE ABOVE GIVEN BY THE R.2. TO THE PETITIONER, DTD. 24/01/2009. RESPONDENTS' EXHIBITS: EXT.R6.A: COPY OF THE PROCEEDINGS OF THE REVENUE DIVISIONAL OFFICER DTD. 06/09/08. EXT.R6.B: COPY OF THE LETTER DTD. 17/12/2008 OF THE TAHSILDAR, MUKUNDAPURAM. //TRUE COPY// P.S. TO JUDGE. Prv. ANTONY DOMINIC, J. -------------------------------------------------- W.P.(C) Nos.38294/2008 & 34198/2009 -------------------------------------------------- Dated this the Ist day of November, 2010 J U D G M E N T Petitioner is a decree holder in O.S.No.212/2004 on the file of the Sub Cout, Iringalakkuda. The suit was filed for money and during the pendency of the suit, by order dated 14.6.2004 passed in I.A.No.1743/2004, the petitioner had secured an attachment of the plaint schedule property before judgment. 2. Once the suit was decreed, petitioner filed EP.No.32/2005 for execution of the decree. Accordingly the attached property of the judgment debtor was auctioned by the court on 9.11.2005. In the sale so held, the petitioner himself purchased the property and the sale in his favour was confirmed on 9.1.2006. Accordingly the property was delivered to the petitioner as per Ext.P1 on 29.6.2006. 3. The judgment debtor was an assessee under the Kerala General Sales Tax Act and had defaulted payment of sales tax during the assessment years 2002-2003, 2003-2004, 2004-2005. In the meanwhile, recovery proceedings were initiated and the aforesaid property was attached in revenue recovery WPC.No. 38294/08 & anor. :2 : proceedings on 7.2.2006. Later, on 26.10.2006, the property was sold under the Revenue Recovery Act and the 6th respondent purchased the property in auction. Though the sale was set aside by the 2nd respondent, in WP(c).No.18589/2007 filed by the 6th respondent, this court rendered Ext.P8 judgment directing the 2nd respondent to reconsider the matter. Although, the petitioner filed Ext.P5 objection before the 2nd respondent, the sale was confirmed by the 2nd respondent as per order dated 6.9.2008. On the strength of the revenue sale, the tenant who was inducted by the petitioner, was evicted from the premises on 20.12.2008 and it was at that stage, the petitioner filed this writ petition challenging the recovery proceedings and praying for a direction to redeliver the property to him. 4. The 6th respondent filed WP(c).No.34198/2009 complaining that although the property was registered in his favour, in pursuance to the interim order passed by this court on 26.2.2009, the property was not mutated and therefore seeking appropriate directions he filed the aforesaid writ petition. 5. The contention raised by the counsel for the petitioner in WP(c).No.38294/2008 is that he is a bona fide purchaser in a court auction and that the sale in his favour is free from all encumbrances and therefore, the sale in favour of the 6th WPC.No. 38294/08 & anor. :3 : respondent is an illegal one. On this basis he seeks a direction that he is entitled to have the property redelivered. In support of this contention learned counsel for the petitioner relied on the judgment of this court in Fancis V. Navodaya Kuries and Loans (P) Ltd. and Others. (ILR 2010(3) Kerala 605). 6. However, the learned Government Pleader resisted the prayer of the petitioner pointing out the fact that long before the sale of the property, which was held on 9.11.2005, the judgment debtor had defaulted payment of sales tax for the assessment years 2002-03 onwards. It is therefore contended that by virtue of the provisions contained in Sections 26 A and 26B of the Kerala General Sales Act, the sales tax due is a first charge over the property and any transaction of the property is void as against State. It is therefore contended that the revenue sale is valid even in spite of the court sale in favour of the petitioner. Section 26A of the Act provides as follows; “Where during the pendency of any proceedings under this Act or after the completion thereof, any assessee creates a charge on, or parts with the possession(by way of sale, mortgage, git, exchange or any other mode of transfer whatsoever), of any of his assets in favour of any person, such charge or transfer shall be void as against any claim in respect of any tax or any other sum payable by the assessee under this Act. WPC.No. 38294/08 & anor. :4 : 7. In the judgment in Hamsa V. Asst. Commissioner (2008(3) KLT 180), this court has held that in order to attract the provisions of Section 26A, it is not necessary that the assessment should be completed and that a demand should be made to the assessee to pay any amount. It was also held that the transferee of a property to which Section 26A applies is not entitled to put forward any defence that the transfer was made for valid consideration or that he is a bona fide purchaser for value. Making reference to the aforesaid judgment, judgment in Laly Vincent V. District Collector (2008(4) KLT 876) was rendered dealing with the case of a property which was sold in execution proceedings, by a Civil Court. In that judgment this court held that, sale of a defaulter's property by a civil court in execution proceedings is also covered by Section 26A of the KGST Act. Therefore, the fact that the property has been sold in execution proceedings by a Civil Court will not take the property out of the purview of Section 26A, if the ingredients of the section are otherwise attracted to a particular case. 8. In this case admittedly, the judgment debtor had defaulted sales tax arrears for the assessment years 2002- 2003,2003-2004 and 2004-2005. If that be so, this is a case to which Section 26A and B are squarely applicable and if so, by WPC.No. 38294/08 & anor. :5 : virtue of the judgments noticed above, the sale is clearly hit by the aforesaid provisions and if that be so, the sale in favour of the 6th respondent has to be held as valid one. If that be so, steps taken by the authorities cannot be said to be invalid. 9. In so far as the judgments in Fancis V. Navodaya Kuries and Loans (P) Ltd. and Others. (ILR 2010(3) Kerala 605) is concerned, the property therein was not one in respect of which, the provisions of Sections 26A and B have application. If that be so, the principles laid down in the said judgment cannot be of any relevance in so far as the facts of this case are concerned. 10. In the result WP(c).No.38294/2008 deserves to be dismissed and I do so. As a necessary consequence, WP(c).No.34198/09 will have to be allowed and the respondents are directed to pass orders mutating the property in favour of the petitioner herein. (ANTONY DOMINIC) JUDGE vi/ WPC.No. 38294/08 & anor. :6 :