Court auction purchaser remains liable for agricultural income-tax arrears where the taxing statute creates a charge on the land.

Section 23 of the Tamil Nadu Agricultural Income-tax Act was treated as creating a recoverable statutory burden on land, so a transferee who bought the property in court auction remained liable for outstanding agricultural income-tax arrears. The Court held that a court auction purchase under section 65 of the Code of Civil Procedure did not displace the tax charge or the Revenue's recovery rights. It also held that the State's failure to realise the dues from sale proceeds lying in court did not bar proceedings against the transferee, because public dues retained priority and the statutory remedy remained available.

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Issues: (i) Whether section 23 of the Tamil Nadu Agricultural Income-tax Act, 1955 applies to a transferee who purchases land in a court auction and renders the transferee liable for agricultural income-tax arrears. (ii) Whether the State's failure to realise the dues from the sale proceeds lying in court prevents it from proceeding against the transferee.

Issue (i): Whether section 23 of the Tamil Nadu Agricultural Income-tax Act, 1955 applies to a transferee who purchases land in a court auction and renders the transferee liable for agricultural income-tax arrears.

Analysis: The liability under section 23 was held to attach to the transferee where agricultural income-tax arrears remained due on the land transferred. The Court treated the land as carrying a charge for the tax dues and held that a court auction purchase does not take the property outside the reach of the statutory recovery scheme. The transferee's title under section 65 of the Code of Civil Procedure, 1908 was found not to override the taxing statute, and the transferee remained liable where the land had been purchased subject to the existing statutory burden.

Conclusion: The issue was decided against the petitioner and in favour of the Revenue; section 23 applies to court auction purchases.

Issue (ii): Whether the State's failure to realise the dues from the sale proceeds lying in court prevents it from proceeding against the transferee.

Analysis: The Court accepted that governmental dues enjoy priority and that the Department had attempted to realise the arrears from the court deposit. However, the inability to secure the amount from the court proceedings did not extinguish the statutory remedy against the transferee. Relying on the priority of public dues and the statutory scheme of recovery, the Court held that the pendency or outcome of the civil proceedings did not bar action against the transferee in possession and enjoyment of the land.

Conclusion: The issue was decided against the petitioner and in favour of the Revenue; the State could still proceed against the transferee.

Final Conclusion: The writ petition failed because the agricultural income-tax arrears were recoverable from the transferee notwithstanding the court auction sale and notwithstanding the unsuccessful attempt to recover the dues from the court deposit.

Ratio Decidendi: Where a taxing statute creates a recoverable burden on transferred land and gives the Revenue priority over other claims, a court auction purchaser takes the property subject to that statutory liability, and the State may proceed against the transferee even if recovery from the court sale proceeds was not achieved.

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