HT Digital
August 12, Monday: In a significant judgment, the Gauhati High Court has ruled that a purchaser cannot be held liable for a seller’s failure to deposit taxes. The court’s decision came in response to a case where the tax authorities attempted to recover unpaid taxes from the purchaser, arguing that the seller had failed to fulfill their tax obligations.
The court clarified that the responsibility to deposit taxes lies solely with the seller, and the purchaser cannot be penalized for the seller’s non-compliance. This ruling is expected to have far-reaching implications for commercial transactions, as it provides greater clarity on the legal responsibilities of both buyers and sellers.
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The judgment underscores the principle that tax liabilities are personal to the party that incurs them, in this case, the seller. It further establishes that the purchaser, having already paid the agreed-upon price, cannot be burdened with additional tax liabilities due to the seller’s failure to adhere to tax regulations.
This decision by the Gauhati High Court has been welcomed by the business community, as it reinforces the protection of purchasers in commercial transactions and ensures that they are not unfairly held accountable for the seller’s lapses. The ruling is expected to serve as a precedent in similar cases across the country.
