Prior enquiry and hearing required before sale of attached property proceeds against a retiring partner.

A retiring partner challenged coercive sale of attached property, arguing that liability covered only a limited period and that his retirement from the firm had been intimated. The Kerala High Court noted that attachment had already been effected and only the sale stage remained, but held that the authority had to conduct the enquiry under section 17(3) of the Kerala General Sales Tax Act, 1963 on the petitioner's representation, after giving him an opportunity of hearing and considering the materials produced. Pending that enquiry, the sale proceedings were to remain in abeyance, while proceedings against the other partners or the firm's assets could continue.

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Issues: Whether coercive recovery by sale of attached property could proceed against a retiring partner without first conducting an enquiry under section 17(3) of the Kerala General Sales Tax Act, 1963 on the petitioner's representation.

Analysis: The petitioner contended that his liability arose only for a limited period and that he had intimated his retirement from the partnership firm. The Court noted that an attachment had already been effected and that the only remaining step was sale of the property. In these circumstances, the Court held that the first respondent was required to conduct the enquiry contemplated by section 17(3) on the petitioner's representation, after affording him an opportunity of hearing and considering the materials produced by him. Pending such enquiry and decision, further sale proceedings in respect of the attached property were directed to be kept in abeyance, while leaving it open to proceed against the other partners or the assets of the partnership firm.

Conclusion: The petitioner was entitled to a prior enquiry and hearing before sale of the attached property could proceed against him to the extent claimed in the notice.

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