176.            ACM Ltd was running in losses. Due to adverse situation of company the following payments were due:

Tax dues = Rs. 20 lakh

Salary of employees = Rs. 2 lakh

Loan amount = Rs. 5 lakh

The company sold its property for Rs.25 lakh. What shall be the priority of the above payments?

As per section 82, the government revenue that is tax interest and penalty shall be the first charge on property of taxable person. Therefore, 25 lakh shall be utilized first to pay tax dues then salaries of employees and then loan amount.