Recovery of tax arrears cannot be resisted on alleged nullity unless the underlying assessment is first set aside.

Recovery of sales tax arrears could not be resisted merely by alleging that the Bombay assessment and penalty were void for breach of Article 286; the subsisting orders had first to be set aside in proper proceedings, so the challenge failed. The Revenue Recovery Act, 1890 was read as a Central enactment permitting a certificate issued in one State to be enforced by recovery authorities in another, so recovery in Kerala of amounts due to Bombay authorities was valid. The Deputy Tahsildar's notice was also upheld because the objection based on competence and delegation under the Kerala Revenue Recovery Act, 1968 was rejected on binding precedent.

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Issues: (i) whether the petitioner could resist recovery of sales tax arrears on the ground that the assessment and penalty were void for breach of Article 286 of the Constitution of India without first having them set aside in appropriate proceedings; (ii) whether the Kerala Revenue Recovery Act, 1968 and the Revenue Recovery Act, 1890 authorised recovery in Kerala of amounts due to the authorities in Bombay; and (iii) whether the notice issued by the Deputy Tahsildar was invalid for want of competence or absence of valid delegation under the Kerala Revenue Recovery Act, 1968.

Issue (i): whether the petitioner could resist recovery of sales tax arrears on the ground that the assessment and penalty were void for breach of Article 286 of the Constitution of India without first having them set aside in appropriate proceedings.

Analysis: The assessment order and the consequential penalty order were not challenged before the competent authorities in Bombay. Even assuming that the levy was vulnerable on the ground that the sales were in the course of import, the petitioner could not ignore the subsisting orders and resist recovery merely by alleging nullity. A void order may remain operative until it is set aside by a competent court or authority in proper proceedings.

Conclusion: The petitioner could not successfully resist recovery on the footing that the Bombay assessment and penalty were void.

Issue (ii): whether the Kerala Revenue Recovery Act, 1968 and the Revenue Recovery Act, 1890 authorised recovery in Kerala of amounts due to the authorities in Bombay.

Analysis: Sections 3, 5 and 10 of the Revenue Recovery Act, 1890 were read together to hold that a certificate issued by a Collector in one State could be acted upon by the Collector in another State. The Act was treated as a Central enactment applicable throughout the country, and the expression 'Collector' was not confined to a district within the same State. Recovery in Kerala of amounts due to Bombay authorities was therefore competent.

Conclusion: Recovery proceedings in Kerala for arrears due to Bombay authorities were held to be valid.

Issue (iii): whether the notice issued by the Deputy Tahsildar was invalid for want of competence or absence of valid delegation under the Kerala Revenue Recovery Act, 1968.

Analysis: The objection to the Deputy Tahsildar's competence was rejected by following binding precedent on the Collector's power to delegate functions under the Kerala Revenue Recovery Act, 1968. The challenged notice was therefore not vitiated on the ground of lack of authority.

Conclusion: The notice issued by the Deputy Tahsildar was not invalid on the ground of incompetence or invalid delegation.

Final Conclusion: The challenge to the assessment, penalty and recovery proceedings failed in all material respects, and the petition was dismissed.

Ratio Decidendi: A person cannot resist recovery on the basis of an order alleged to be void unless that order is first set aside in proper proceedings, and a certificate under the Revenue Recovery Act, 1890 may be enforced across State boundaries by the competent recovery authority.

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