Garnishee-style tax recovery cannot reach a director's personal property without a debtor-creditor relationship or statutory notice.

Section 44 of the Gujarat VAT Act operates like garnishee recovery and applies only where money is due to the dealer or held for the dealer's account. It cannot be extended to attach the personal immovable property of a director or a relative in the absence of a subsisting debtor-creditor relationship with the dealer. The provision also requires notice to the person proceeded against so they may object before coercive recovery action is taken. Because taxing provisions must be strictly construed, recovery machinery cannot be expanded beyond the clear language of the statute.

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Issues: Whether the respondents could invoke Section 44 of the Gujarat Value Added Tax Act, 2003 to attach the personal immovable properties of the director and the brother of the director for recovery of the company's tax dues, in the absence of a debtor-creditor relationship and without issuing the notice contemplated by the provision.

Analysis: Section 44 is in the nature of garnishee proceedings and can be used only against a person from whom money is due or may become due to the dealer, or who holds money for or on account of the dealer. The provision presupposes a subsisting debtor-creditor relationship between the dealer and the person proceeded against. The Court held that the personal properties of the director and his brother could not be treated as the company's assets or as money due to the company. It further noted that no notice was served on them in the manner required by Section 44, and therefore they were deprived of the opportunity to object and be heard before coercive recovery action was taken. Since taxing statutes must be construed strictly, the department could not extend the provision beyond its clear language.

Conclusion: Invocation of Section 44 against the personal properties of the director and the brother was not justified, and the attachment was held to be without jurisdiction and liable to be quashed.

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