Property Tax- liability of second buyer for prior period
vswaminathan
(Querist) 24 June 2011
This query is : Resolved
ref. the Q and Expert 'A' per your recent update:
May I add my view:
As is expected to be known, ‘property tax’ is in the nature of a ‘statutory debt’, and as such, attaches itself to the ‘property’ as a ‘prior charge’. As such, on the facts given, strictly speaking, whoever is the present owner will be liable to pay, and in the event of non-payment, the local authority will be within its powers to take steps for recovery of the demand from him.
Other points of doubt which arise/worth enquiring /investigating are>:
1. Amount demanded, by any known standard, seems unreasonably LARGE; MAY BE, IT INCLUDES ‘INTEREST and PENALTY’(Is that so !?). Better obtain a complete break-up; that should be of help.
The fact that the demand has come to be made after a gap of years itself is intriguing; hence to be inquired into, to ascertain the reason for inordinate delay/ who is to be blamed for it- is it the local authority itself, -if so, why ‘penalty’, for that matter even interest’, if any demanded, could be charged?
2. ON ANY RESALE, THE BUYER , EVEN AS A COMMON MAN, OR HAD HE acted with LEGAL ASSISTANCE, IS EXPECTED TO HAVE MADE CERTAIN , WITH PROOF, THAT ALL ‘DUES’ OF THIS NATURE TILL DATE OF PURCHASE HAD BEEN PAID, AND IF ANY OUTSTANDING (OR EXPECTED TO ARISE LATER), is protected by a suitable ‘indemnity’ clause in the ‘sale deed’ itself. (Also, look up how this aspect was covered in the first sale deed execute by the builder/seller.
Be that as it may, the second owner, in any case, may have a good ground in ‘equity’ to claim and recover the ‘proportionate amount’ from the first owner; and if refused, take legal steps, in consultation with a competent lawyer.
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VSWAMINATHAN
Guest
(Expert) 24 June 2011
Sure, only indemnity clause in the Sale Deed can ensure liability of the previous owner of the property. Otherwise, the buyer was required to verify from the local authorities if there was any outstanding dues against the property. If no provison about the past dues is made in the sales deed the liability would stand transferred to the buyer of the property.
prabhakar singh
(Expert) 24 June 2011
property passes with all rights and liabilities
mr PS Dhingra, CEO, Dhingra Group has rightly opined.
but i see author :mr vswaminathan himself clear on point in issue.
vswaminathan
(Querist) 24 June 2011
The viewpoints as put forth by me, I believe, deal with the appilcable general propositions.
Nonetheless, for a detiled examination, and coming to a definitive conclusion, the following crucial aspects require to be borne in mind:
1. The property -'Flat' has peculiar legal charachterists, and s mainly governed by the special enactment applicable thereto.
2. For many purposes (except say, for income-tax),the land and building (of Flats)is regarded as the proprty of the "Co-operative Society' constituted by the Flat Purchasers jointly as its members.
3, Further, for property tax,for ascertaining as who exactly is the person regarded as the 'assessee' and primarily liable to pay - though the tax as assessed on the whole of the property happens to be collected/eventually shared/borne by the individual flat purchasers, - one should necessarily have regard to the governing statute/ rules and regulations as per which the tax is levied.
For getting a basic but overall idea of the aforementioned aspects, one may find help/useful clues in the material made available, in the larger public interest, in the Blog @ http://vswaminathan-swamilook.blogspot.com/2011/03/apartment-and-flat-distinction-between.html;
also, in certain other Blogs devoted to the subject.
vswami
RAJU O.F.,
(Expert) 26 June 2011
If the sale of the property is through public auction, the authority conducting the auction had to disclose the property-tax arrears. If such arrears not disclosed, then the beneficiary of the auction proceeds, has to pay the arrears of tax, applicable till the date of sale.
