Judgment :- This company application praying this Court:- (An order of injunction restraining the 2nd and 3rd respondent from disconnecting the water and sewerage connection or take any other distress action against the 4th and 5th floor at Greams Dugar, No.149, Greams Road, Chennai-2 pending disposal of the above applications.) Chitra Venkataraman, J. These applications are filed by M/s. Shriram chits Tamil Nadu (Private) Limited, Chennai, seeking a direction to direct the Administrator, Dugar Finance India Limited, in liquidation, to bear the past arrears of property tax and water and sewerage tax and charges payable to the Corporation of Madras and Chennai Metro Water Supply for the period from 2/98-99 to 2/03-04 for the 4th floor and 5th floor at No.149, Greams Road, Chennai-6. There is also a prayer for injunction restraining the Corporation of Chennai and the Chennai Metropolitan Water Supply and Sewerage Board from claiming past arrears of property tax and water tax and charges for the period prior to the date of the purchase i.e. 10.12.2004 and for injunction restraining the above parties from disconnecting the water and sewerage connection and to take any action against 4th and 5th floor at Greams Dugar, No.149, Greams Road, Chennai 2, pending disposal of the above applications. 2. By order dated 29.4.2005, this Court granted injunction on condition that the applicant pays 50% of the amount due as arrears in respect of water and sewerage connection and property tax, except, surcharge and interest. 3. The first respondent in this application is company in liquidation, viz., Dugar Finance India Limited. By order dated 8.8.2002 in C.P.No.48 of 2000, this Court ordered winding up of the company. Under orders of this court, the property of the first respondent viz., commercial complex at Greams Dugar, No.149, Greams Road, Chennai 600 006, more particularly, 4th and 5th floor, with proportionate undivided share in the property, was sought to be sold to clear the dues to the creditors. The applicant herein is the successful purchaser of the property for a total sale consideration of Rs.59,50,000/- for each of the floor. Under orders of this Court dated 15.4.2004 made in C.A.No.524 and 525 of 2004, the Official Liquidator executed sale deed dated 10.12.2004 in favour of the applicant herein. The applicant took possession of the property in 4th and 5th floor. Under orders of this Court dated 15.4.2004 made in C.A.No.524 and 525 of 2004, the Official Liquidator executed sale deed dated 10.12.2004 in favour of the applicant herein. The applicant took possession of the property in 4th and 5th floor. It is stated by the applicant in their application that after taking possession, by notice dated 27.1.2005, the applicant was called upon to pay the arrears of property tax and water tax-to the tune of Rs.4,71,080/- towards property tax, Rs.2,78,761/- towards water tax, totaling in all a sum of Rs.7,49,841/-. The arrears of property tax was stated to be for the period from 2/99 to 2/04-05 for 4th floor as well as for the 5th floor. The water tax was for the period from 1/2000-01 to 2/2004-05 and for the 5th floor from 2/97-98 to 2/2004-05. 4. It is contended by the applicant that in the deed executed in favour of the applicant, it was stated that the property was free from all encumbrances. Hence, the applicant could be liable for statutory dues only for the period post the sale and applicant are not bound to honour the arrears falling due prior to the date of purchase. Referring to the clause in the tender form as regards the purchaser’s liability to pay the arrears of statutory dues after confirmation of sale, the applicant contends that the dues were not intimated by the Official Liquidator. Further there was no reference made as regards the liability on the past arrears in the sale deed. In support of this contention, the applicant relies on Section 55 (1) (g) of the Transfer of Property Act and submits that in the absence of contract to the contrary as regards the tax dues in the sale deed, the applicant were not liable to meet the same. 5. The applicant also referred to the refusal of the statutory authorities to effect change of their name in the property Register in spite of the fact that they had remitted current dues. The rejection was solely on the ground that the arrears were not cleared. 6. The applicant contends that the arrears of tax including surcharge and interest are to be collected from the estate of the company in liquidation only, that the sale consideration was an all inclusive one. The applicant also made a submission that the demand for the arrears was barred by limitation. 6. The applicant contends that the arrears of tax including surcharge and interest are to be collected from the estate of the company in liquidation only, that the sale consideration was an all inclusive one. The applicant also made a submission that the demand for the arrears was barred by limitation. Referring to Section 530 (a) of the Companies Act, the applicant submitted that all revenues, taxes, and rates due from the company to the central or State Government, falling due and payable within 12 months next before the due date shall be paid in priority to all other debts. Hence, the Administrator was bound to clear the arrears from the sale proceeds recovered from the applicant. In the circumstances, the applicant submits that the first respondent be directed to pay the arrears. 7. The Administrator, the first respondent herein, has filed his counter. The first respondent has made a specific reference as regards the conditions stipulated in the tender form that the arrears of Municipal tax, property tax, betterment levy, maintenance if any, were to be paid by the purchaser only. The Administrator representing the company in liquidation, the first respondent, could not be loaded with any liability in this regard. The Administrator denied the contention that the applicant had to pay only the current due as not tenable. The Administrator further contends that when once the applicant and bound itself with the tender conditions to clear the arrears, it cannot be wriggle out of its responsibility. The claim of bona fide belief that since betterment charges and other regular charges were discharged for the 4th to 7th floor and hence, these dues were also discharged was totally false. 8. Referring to the terms of the tender, the first respondent submits that in the course of negotiation, leading to purchase of the property, the applicant was given details of the property and water tax arrears, that only with this knowledge, the applicant had participated in the tender. In these circumstances, when once the applicant had knowledge of the arrears and accepting the terms in the tender, participated in the proceedings, the present application is totally unsustainable, as such, the applicant is estopped from denying its liability. The Administrator submits that it is the duty of the applicant to clear the arrears as undertaken in the tender application. In these circumstances, when once the applicant had knowledge of the arrears and accepting the terms in the tender, participated in the proceedings, the present application is totally unsustainable, as such, the applicant is estopped from denying its liability. The Administrator submits that it is the duty of the applicant to clear the arrears as undertaken in the tender application. The Administrator further submitted that the provisions of Section 530(a) of the Companies Act has no relevance to the present case. Hence, reliance is totally misconceived consequently, the Administrator prayed for dismissal of this application caused. 9. The second respondent, viz., the Commissioner, Corporation of Chennai has filed his counter stating that the property tax is the first charge on the property as per law. Hence, the applicant has to ensure even before the registration, the existence of any arrears. He further submitted that as per law the purchaser is fully responsible for making of payment of tax arrears as ‘owner’, that the claim of property tax arrears for the period from six years are permitted as per law. 10. The third respondent, viz., Chennai Metropolitan Water Supply and Sewerage Board has filed its counter. It is pointed out in the counter that this third respondent has given a water connection and sewerage connection and there is no water meter, hence, flat rate demand at the minimum charges was raised. Since the premises in the floors are occupies by offices, both the flats come under the flat rate non-water intensive and partly commercial category towards water supply charges. In view of the default committed, as per Section 81 (2) j of CMWSS Act, 1978, surcharge was demanded. Referring to Section 62(2) of CMWSS Act, 1978 and placing reliance in W.P.No.25132/05 dated 5.8.2005, the third respondent supported the action that the applicant being the present owner was liable to pay dues. This respondent also denied the relevancy of the Transfer of Property Act and submitted that both the owner and occupier of the premises are responsible for payment of all the sums due to the Board. The third respondent submitted that the applicant had paid the water charges for the period from 1/2004-05 to 2/2004-05 along with surcharge for each floor. This respondent also denied the relevancy of the Transfer of Property Act and submitted that both the owner and occupier of the premises are responsible for payment of all the sums due to the Board. The third respondent submitted that the applicant had paid the water charges for the period from 1/2004-05 to 2/2004-05 along with surcharge for each floor. Placing reliance on the decision of this Court rendered in W.P.No.13894/90 dated 28.8.90, the respondent submitted that the arrears of tax, rate, charge, cost, fee, rent are liable to be recovered as arrears of land revenue under the Revenue Recovery Act and that the facts of the present case are not different. The applicant being a defaulter, is liable to clear the arrears. 11. It is stated that as per the Court’s direction, the applicant has already paid 50% of the amount due, except surcharge. The arrears payable, have not been cleared in full so far. In the circumstances, apart from praying for vacating the injunction already granted, the third respondent prayed for rejection of the stand of this applicant. 12. Mr. K.V. Anantha Krishnan, learned counsel appearing for the applicant made a reference to the sale deed dated 10th December 2004 and submitted that the consideration paid for the purchase of the property was a sum of Rs.59,50,000/- each, individually to the two floors, free from all encumbrances. The learned counsel also referred to the convenant in the sale deed that vendor, namely the Official Liquidator as liquidator of the company in liquidation had declared and convenanted that the applicant as a purchaser of the subject property was not encumbered in favour of any person or body, as such in the context of such convenant, there cannot be any liability fastened on this applicant as regards his past arrears. The learned counsel also submitted that there were no order regarding the arrears. Hence Section 55 of the transfer of Property act has a direct bearing. He referred to Section 55(1) (g) and submitted that in the absence of a contract to the contrary, the seller is bound to pay all public charges and dues in respect of property up to the date of his sale on all encumbrances on such property due on such date, to discharge all incumbrances on the property except in cases where the property is sold subject to encumbrances, then existing. Hence, in the absence of any contract to the contrary in the sale agreement, the applicant was not legally bound to clear the statutory dues. The learned counsel also submitted that there was no reference to the arrears in the sale confirmation. Consequently, the liability is only that of the first respondent and should not be shifted to the applicant herein. 13. In support of his plea that the sale was free from encumbrances and in the absence of any contract to the contrary in the context of Section 55 (1) (g) of the Act and Section 69 of the Contract Act, that the vender alone was responsible to make the payment, the learned counsel for the applicant relied on the following reported decisions- (1) Nathu vs. Burtonath (AIR 1922 Privy Council 76) (2) Bhagwati vs. Bonarsi Das (AIR 1928 Privy council 98) (3) Imam Din vs. Bhag Singh (AIR 1936 Lahore 746) (4) Gondal State vs. Govinram Seksaria (AIR (32) 1945 Bombay 187) 14. Apart from this he also relied on (1) Chendrayya vs. Hanumayya (AIR 1927 Madras 193) (2) Harcharan Lal Vs. Nurul Hasan (AIR 1934 Oudh 492) (3) Mahomed Ali Sheriff vs. Venkatepathi Raju (39 MLJ 449) (followed in) (4) Mahamood Mamuna Lebbai vs. The National Bank of India Limited (1944 II MLJ 264) (5). G.G. Chettiar vs. N.G. Gowder (AIR 1972 Madras 36) and supported all the above propositions. The learned counsel also made a reference to Section 69 of the Contract Act. 15. The learned counsel appearing for the first respondent submitted that the case reported in Gondal State vs. Govinram Seksaria (AIR (32)_1945 Bombay 187) was distinguishable. In that case, the offer itself is subject to the terms of the tender forms. There is no contract implied to the contrary. As regards the term in the tender which clearly spoke about the responsibility of the purchaser to clear the dues, she further submitted that once the tender conditions were accepted and participated, the clause in the sale deed could not be invoked to resist the demand. In this context, she relied on the decision reported in (1994) 1 Supreme Court Cases 575 in the case of United Bank of India vs. Official Liquidator. 16. A perusal of the tender form shows that the applicant herein had specifically offered to purchase the property subjected to terms and conditions of the tender. In this context, she relied on the decision reported in (1994) 1 Supreme Court Cases 575 in the case of United Bank of India vs. Official Liquidator. 16. A perusal of the tender form shows that the applicant herein had specifically offered to purchase the property subjected to terms and conditions of the tender. Under Clause 7 of the tender conditions, the arrears of Municipal tax, Property tax, betterment levy and maintenance should be paid by the purchaser in respect of the property brought for sale after confirmation of sale in his favour. The sale in this case was confirmed by this court under order dated 15th April 2004 for a price of Rs.59,50,000/- for each of the floor. Under order dated 28th April 2004, this Court permitted the Administrator to execute the sale deed on the purchaser paying the entire sale consideration. The fact that the order of this court does not refer to the tax arrears while confirming the sale does not mean that the tender conditions of clause 7 is waived impliedly either by the Official Liquidator, the first respondent herein or this Court, while directing the registration. It is no doubt true that there was a reminder from the second respondent as well as from the third respondent towards tax arrears on 27.1.2005. The fact that it was addressed to the erstwhile owner and not directly to the present owner, viz., the applicant herein, does not wipe out the terms of the tender conditions, as an implied variation of the terms of the tender. It may be remembered that participating in the auction itself is subject to the applicant agreeing to the terms of the tender, one of which is regarding the tax arrears. Hence, when clause 7 of the terms and conditions specifically speak about the tax arrears to be paid by the purchaser in respect of the captioned immovable property of the company in liquidation, after confirmation of sale in his favour”, it is not now open to the applicant herein to draw support from the provisions contained in Section 55(1) (g) of the Transfer of Property Act. 17. The learned counsel also referred to Section 69 of the Contract Act. 17. The learned counsel also referred to Section 69 of the Contract Act. This Section applies where a persons pays money which another is bound to pay and thereby the obligation of other person is discharged, then the person paying the amount is entitled to reimburse of the same. This section thus indemnify a person footing the liability of another person. I do not find any reason to invoke this provision as it has no relevance in the context of the terms and conditions of the tender form to which the applicant herein had agreed to. 18. The learned counsel however refers to a clause in the sale deed that the sale itself was free from encumbrances and hence, he is entitled to be recouped by the vender. In this connection, he placed reliance on one of the earliest decisions in the case of Nathu vs. Burtonath reported in AIR 1922 Privy Council 176. 19. This case relates to one invoking Section 55(1) (g) of the Transfer or Property Act. A perusal of the judgment shows that one Lakpathnath sold his property to Nathukhan and three others. There was certain debts due from the vendor to the purchaser. The balance of the consideration was to be paid in cash. Anxious to settle their dues, the vendors had gone for arrangement with yet another party Bindesir Charan and there was a sale of another property. All these were necessitated for clearance of number of debts which included those on the property already sold to Nathukhan and others, the respondents in the decided case. Bindesri Chjaran who had prior charge on the properties sold the properties which necessitated Nathukhan and others to take steps to realize their securities by sale. Nathukhan and others paid the said sum to clear the property. After payment, Nathukhan and others instituted a suit against the Bindesri Charan and Lakpathnath for recovery of the sum paid against the properties. Referring to the sale in favour of the Nathukhan and others, the Privy council held that the vendor had bound himself to deliver the property free from encumbrances and had delivered the properties. In the circumstances, the vendor was liable to reimburse the money paid by Nathukhan for clearing mortgages existing on the properties purchased by him. 20. Referring to the sale in favour of the Nathukhan and others, the Privy council held that the vendor had bound himself to deliver the property free from encumbrances and had delivered the properties. In the circumstances, the vendor was liable to reimburse the money paid by Nathukhan for clearing mortgages existing on the properties purchased by him. 20. The case in Bhagwati vs. Bonarsi Das reported in AIR 1928 Privy Council 98 is also on the provisions of Section 55(1) (g) of the Transfer of Property Act. Referring to the scope of Section 55 of the Act, the Privy council held that the terms of the Section is absolute in the sense that in the absence of contract to the contrary, the seller is bound to discharge all encumbrances that exist on the property. Referring to the facts of the case the Privy council held that the vendee paid a sum due under another mortgage under compulsion of decree obtained by the mortgage holder; undoubtedly, vendee was entitled to have the payment recouped from the vendor. The Privy Council also referred to Section 69 of the Contract Act that this payment of money was made by the vendee which the vendor was bound to pay by law. Hence, vendee was entitled to the reimbursement. Referring to terms of the sale deed, the Privy Council stated that the terms of the deed did not wipe out the obligation under the statute. In the context of the said terms in the deed, the Privy Council affirmed the view of the courts below. The Privy Council further pointed out that there was an absolute declaration by vendor to the vendee that he sold the property free from all mortgages and covenants. Except the one named therein. 21. The third decision reported in AIR 1936 Lahore 746 in the case of Imam Din vs. Bhag Singh relates to a case wherein the sale deed contained a covenant as regards the non existence of encumbrances. Referring to the subsequent breach, the Lahore High Court held that, “it is not legal necessary that there should be an expressed condition in the sale deed on the part of the seller to indemnify the purchaser”. It was further held that, “A covenant guaranteeing the non-existence of encumbrances necessarily implies such a condition of indemnity”. 22. Referring to the subsequent breach, the Lahore High Court held that, “it is not legal necessary that there should be an expressed condition in the sale deed on the part of the seller to indemnify the purchaser”. It was further held that, “A covenant guaranteeing the non-existence of encumbrances necessarily implies such a condition of indemnity”. 22. The case in Gondal State vs. Govinram Seksaria reported in AIR (32) 1945 Bombay 187, relates to invoking of Section 55(1) (g) of the Transfer of Property Act and Section 69 of the contract Act. Referring to earlier Privy Council decision on Section 55(1) (g) of the Transfer of Property Act, the Bombay High court held that, “ …………… Section 55(1) (g) is an implied terms, unless it is negatived by the terms of the contract between the parities. It only provides that when a property is agreed to be sold, the seller shall be bound to pay all public charges and all incumbrances up to the date of sale. That liability exists before completion and continue thereafter whether the existence of such charges or incumbrances is discovered before or after completion. The obligation, unless there is a contract to the contrary, is absolute”…………… (i) Referring to Section 69 of the Contract Act, Justice Kania (as he then was) held that, “………..The various decisions considered under Section 69, Contract Act, show that the party making the payment must have a contract to pay, or interest - Present, future or contingent – in the property”………………. (ii) On the facts the Court held that there was no express or implied obligation on the part of the defendants to repay the amount. 23. A reading of the above judgments clearly show that Section 55(1) (g) of the transfer of Property Act is absolute in its character, where there exists a covenant guaranteeing the non existence of encumbrances irrespective of the fact that the same was discovered after the sale, the liability is that of the seller only. The purchaser making the payment on behalf of the vendor is entitled to the recoupment of the same. However, where there existed no such covenant to the contrary, there could arise no automatic invoking of Section 55(1)(g) to the benefit of the purchaser that there existed an implied condition that there were no encumbrance. 24. The purchaser making the payment on behalf of the vendor is entitled to the recoupment of the same. However, where there existed no such covenant to the contrary, there could arise no automatic invoking of Section 55(1)(g) to the benefit of the purchaser that there existed an implied condition that there were no encumbrance. 24. In the case on hand, as noted earlier, the applicant herein had offered to purchase the property subject to the terms in the tender form. The crucial document to be adhered to is the tender condition relating to the purchaser offering to purchase and undertaking to pay the tax dues after the confirmation of sale in his favour. The fact is that the purchaser was put on notice about the existence of arrears of municipal tax, property tax and other levy. Aware of the same, he has volunteered to register his offer himself as a successful purchaser, but subject to the condition that he would pay the arrears after confirmation of sale. The fact that the sale deed executed by the Official Liquidator on behalf of the company in liquidation, recites that the property is free of encumbrances, does not in any way cancel the conditions of his offer in the tender. The clause which stands outside the sale deed by reason of undertaking in the offer cannot be taken as one given up at the instance of vendor, viz., the Official Liquidator, executing the sale deed. 25. The learned counsel for the applicant placed reliance on a decision reported in AIR 1934 Oudh 492 in the case of Harcharan Lal vs. Nurul Hasan. This case refers to Section 55(1) (g) of the Transfer of Property Act as casting the statutory liability on the seller to discharge all encumbrances at the time of sale. The decision rests on the facts of the case and hence does not have any relevance to the case on hand. 26. As regards the case in Chendrayya vs. Hanumayya (AIR 927 Madras 193), the contention in the decided case was that the plaintiff purchased the property and that there were no recitals as regards the existence of an encumbrances. But the same were introduced after the sale deed was executed. 26. As regards the case in Chendrayya vs. Hanumayya (AIR 927 Madras 193), the contention in the decided case was that the plaintiff purchased the property and that there were no recitals as regards the existence of an encumbrances. But the same were introduced after the sale deed was executed. Referring to clauses given in the sale deed, the Court held that in construing the documents of this kind, where terms which have got some well defined meaning are not used, the Court should see what meaning the parties intended to convey. Adverting to the finding of the court below, the court held that the sale was subject to the mortgage and there were enough records to support such a finding. Referring to the conduct of the parties, the Court held that, no doubt the encumbrance was not mentioned in the documents, however, the clause used in the documents were wide enough to include the encumbrance on the property. The rejected the case of the plaintiff/purchaser. 27. The case reported in Mahomed Ali Sheriff vs. Venkatepathi Raju reported in 39 MLJ 449, is yet another decision of this Court invoking Section 55 of the Transfer of Property Act. The Court held that mere knowledge on the part of the vendee of a defect in the title of the vendor would not by itself defeat the vendee’s right on the basis of a covenant implied. Where there are express words of the vendor’s covenant for title, the rights of the vendee could not be defeated, unless there are ambiguous expression in the document as regards what was intended or otherwise. 28. The case in Mahamood Mamuna Lebbai vs. The National Bank of India Limited reported in 1944 II MLJ 264 is a decision of this Court. Following the decision reported in 39 MLJ 449, that where the vendee finds subsequent to the sale containing a covenant as regards the encumbrance that there was a charge on the property, this Court held that the covenants implied by Section 55 can be excluded only by an express contract and not by implication. In the case of the reported decision, the appellant purchased the property from the respondent, who later found out that there was charge on the property. The purchaser paid certain sum towards charge, which was decreed. In the case of the reported decision, the appellant purchased the property from the respondent, who later found out that there was charge on the property. The purchaser paid certain sum towards charge, which was decreed. When the purchaser filed a suit for recovery of a sum paid, the Court held that deed did not show that what was sold was subject to encumbrances. Hence, in the absence of contract to the contrary, the vendor was under an obligation to discharge the encumbrances then existing on the property. In the context of the facts shown therein, the Court held that vendor was bound to express with reasonable clarity as regards subsistence or otherwise of the encumbrances and where the terms used or expressions used are capable of misconstruction or ambiguous, the purchaser may generally construe them in the manner most advantageous to himself. The court relied on the passage from Mulla in the Transfer of Property Act and held that there are no unambiguous language as regards the sale, subject to encumbrance. Consequently, the Court held that the vendor was bound to recoup the loss suffered. 29. The case in G.G. Chettiar vs. N.G. Gowder reported in AIR 1972 Madras 36, is a case again pertaining to Section 55(1) (g) of the Transfer of property Act. Referring to the document reciting that vendor had absolute and perfect right in conveying the property, the Court held that it was clear that the property was not sold subject to encumbrances and hence, vendor was bound to discharge the encumbrances on the property. 30. It may be noted that all theses cases rested on the specific terms in the sale deed, as such, they cannot have bearing on the facts of this case where the purchaser participating in the sale had offered to clear the statutory dues. As the courts have held in all these decided cases, the conduct of the parties and terms relating to the transactions need to be looked into. In the circumstances of the case, there is no ground for accepting the plea of the applicant herein. 31. As the courts have held in all these decided cases, the conduct of the parties and terms relating to the transactions need to be looked into. In the circumstances of the case, there is no ground for accepting the plea of the applicant herein. 31. It may be noted that under the provisions of the Municipal Corporation Act, the arrears of tax is charge on the property concerned; where the property is transferred to person for full consideration and possession given the liability to pay tax for the pre transfer period goes along with the property and transferee is liable to clear the arrears. The liability of the transferee herein arises from the fact of his being the ‘owner’ of the property concerned. The liability charged to the property is not relieved unless and until the same is discharged. Hence, considering the offer made by the transferee herein, reliance on the sale deed recitals does not relieve the transferee/the applicant herein on his liability to meet the arrears of the statutory dues. The recitals in the deed that the sale is free from encumbrance need to be read in the context of the offer made by the applicant herein. 32. I do not find any merit in accepting the plea of the applicant herein. Hence, the applications are dismissed. There shall be no order as to costs.