Constructive notice and VAT recovery powers cannot invalidate a bona fide flat purchase or force a society to withhold certification.

A bona fide purchaser of a flat could not be fixed with constructive notice of alleged VAT dues where public notices had been issued before completion of the sale, the deed was registered before the impugned communication, and no material showed any prior notice of charge or recovery. The Gujarat VAT Act, 2003 also did not authorise revenue to direct a housing society to withhold a no objection certificate, because the statute provides recovery mechanisms but no express machinery for the authority to declare a transfer void or impose such an embargo. The impugned communication was therefore quashed, and the certificate had to be issued.

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Issues: (i) Whether the petitioner could be fixed with constructive notice of the alleged VAT dues so as to invalidate the purchase of the flat. (ii) Whether the VAT authorities had jurisdiction under the Gujarat Value Added Tax Act, 2003 to direct the housing society not to issue a no objection certificate to the petitioner.

Issue (i): Whether the petitioner could be fixed with constructive notice of the alleged VAT dues so as to invalidate the purchase of the flat.

Analysis: The petitioner had issued public notices inviting objections before completion of the purchase, and the sale deed was executed and registered before the impugned communication. The alleged dues had accrued much earlier, yet no response was made to the public notice and no material showed that the petitioner was informed of any charge or pending recovery. In these circumstances, the principle of constructive notice could not be invoked against a bona fide purchaser for value.

Conclusion: The petitioner could not be fixed with constructive notice of the VAT dues, and the purchase could not be invalidated on that basis.

Issue (ii): Whether the VAT authorities had jurisdiction under the Gujarat Value Added Tax Act, 2003 to direct the housing society not to issue a no objection certificate to the petitioner.

Analysis: Section 47 contemplates avoidance of transfers made with an intention to defraud government revenue, but the Act does not confer any machinery on the authorities to themselves declare such transfer void or to create an independent embargo on the society issuing a certificate. The statutory scheme provides recovery-related powers such as notice, provisional attachment, and recovery as arrears of land revenue, but not a direction to a society withholding a no objection certificate. Any declaration that the transfer is void on the ground of fraud must be sought before the civil court.

Conclusion: The impugned direction was beyond the powers conferred by the Act and was without jurisdiction.

Final Conclusion: The communication was quashed, the society was required to issue the certificate, and the writ petition succeeded in full.

Ratio Decidendi: A revenue authority cannot, in the absence of express statutory machinery, itself declare a transfer void for alleged fraud on revenue or issue directions to a third party society to withhold a no objection certificate; such relief must be pursued in accordance with the statutory recovery framework and, where title is in dispute, before the civil court.

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