Transfer void against tax claim under sales tax law; no prior disclosure of arrears to transferee required before recovery.

Section 26A of the Kerala General Sales Tax Act, 1963 renders transfers made during pending or completed tax proceedings void against the tax claim, and its constitutional validity had already been upheld. Applying that settled position, the transfer was treated as void against the sales tax liability. The statute also imposes no duty on revenue authorities to disclose the transferor's precise arrears to the transferee before proceeding against the property. Because notice under the Revenue Recovery Act had been served and answered, no procedural defect was shown and the attachment and recovery action were sustained.

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Issues: (i) Whether section 26A of the Kerala General Sales Tax Act, 1963 was constitutionally valid and applied to render the transfer void against the tax claim. (ii) Whether the revenue authorities were required to furnish the transferee with the details of arrears or issue a prior notice before proceeding against the transferred property.

Issue (i): Whether section 26A of the Kerala General Sales Tax Act, 1963 was constitutionally valid and applied to render the transfer void against the tax claim.

Analysis: Section 26A declares void, as against any tax or other sum payable under the Act, any transfer made during the pendency or after completion of proceedings under the Act. The provision operates by statutory force and does not depend on a prior notice to the transferor or transferee. The Court noted that the constitutional validity of the provision had already been upheld and applied that legal position to the facts of the case.

Conclusion: The challenge to section 26A failed, and the transfer was liable to be treated as void against the sales tax claim.

Issue (ii): Whether the revenue authorities were required to furnish the transferee with the details of arrears or issue a prior notice before proceeding against the transferred property.

Analysis: The Court held that the statute casts no obligation on the revenue authorities to inform the transferee of the precise amount due from the transferor. The transferee, if desirous of protecting the property, had to ensure discharge of the liability. Since notice under section 44(2) of the Revenue Recovery Act had in fact been served and replied to, no procedural infirmity was made out in the recovery steps.

Conclusion: No prior disclosure of arrears to the transferee was required, and the recovery proceedings were valid.

Final Conclusion: The statutory bar on transfers made to defeat tax recovery was enforced, and the challenge to the attachment and recovery action was rejected.

Ratio Decidendi: A transfer made during the pendency of sales tax proceedings is void as against the revenue claim, and the revenue authorities are not required to give the transferee prior notice of the arrears before proceeding against the transferred property.

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