Recovery charge cannot bind a bona fide auction purchaser without prior attachment and lawful communication of encumbrance.

Recovery under the Tamil Nadu General Sales Tax Act required a valid demand and concrete steps to create and communicate a charge over the assessee's property before the encumbrance could be enforced against third parties. Mere reference to the recovery provision, without prior attachment or lawful transmission of the charge to the Sub-Registrar, was insufficient. The court noted that the petitioner bought the properties in a public auction for full consideration, received the sale certificate, and took title when no subsisting encumbrance or charge was shown on record. As the purchase was bona fide and there was no material suggesting intent to defeat revenue, the communication directing registration of a charge was quashed.

---

---

Issues: Whether the communication directing the Sub-Registrar to register a charge over the petitioner's properties could be sustained under the recovery provisions of the Tamil Nadu General Sales Tax Act, 1956, particularly where no prior attachment or charge had been created and the petitioner claimed to be a bona fide auction purchaser.

Analysis: The recovery mechanism under Section 24 contemplates a valid demand and the creation of a charge on the properties of the person liable. For Section 24-A to operate, the revenue must take concrete steps to identify the assessee's assets, attach the property in the manner known to law, communicate the attachment to the Sub-Registrar, and ensure that the encumbrance record reflects the charge. Mere reliance on the provision, without any antecedent attachment or other protective action, is insufficient. The petitioner purchased the properties in 2010 in a public auction for full consideration, the sale certificate was issued in 2011, and the record showed no subsisting encumbrance or charge at the time of purchase. The transaction was unrelated and bona fide, and there was no material to show an intention to defraud revenue.

Conclusion: The impugned communication was unsustainable and was quashed; the writ petition was allowed in favour of the petitioner.

---