Tags not associated in OS X
Issued sudo mdutil -i on "/Volumes/External-SSD” and got back "Indexing and searching disabled.” for external HDD. 
Defaults write com.apple.finder AppleShowAllFiles -boolean true ; killall Finder (shows all file)
Go to hdd where indexing is not working. externalssd in my case. find locate .metadata_never_index &amp; delete it.
sudo mdutil -i on "/Volumes/External-SSD” started spotlight indexing and indexes are created.
Tags working now.


This concludes that Tag functionality is dependant on spotlight and needs to be enabled.