JIVANLAL MAGANLAL PATEL Vs. MANGALDAS JOSHI

JUDGEMENT

(1.) Short question which arises to be considered in this case is whether a transferee of a business who has incurred liability to pay the sales-tax under sec. 19(4) of the Bombay Sales-Tax Act 1959 is entitled to a notice of pending assessment proceedings against the transferor under the said Act.

(2.) Facts of this case are that the petitioners are partners of a firm running its business under the name of Reliable Engineering Works. In the year 1961 there was one person named Mugadi Miya Kherati Miya who was conducting his business under the name of Azad Moulding Works. The said business was taken over on 1-11-1961 by the then partners of the firm of the petitioners. The petitioners firm Reliable Engineering Works was constitute at that time by four partners two of whom were petitioners Nos. 1 and 2 Jivanlal Maganlal Patel and Maneklal Maganlal Patel the other two being Ishverlal Sankalchand Patel and Chandrakant Chimanlal Shah. It is not in dispute that after the Reliable Engineering Works took over the business of Azad Moulding Works an application was made on behalf of the former to the Sales Tax department to treat it as the transferee of the later and to issue Sales. Tax certificate accordingly. This request was granted by the department. The case of the petitioner is that thereafter from 1-1-1963 there was reconstitution of their firm as the above said Ishverlal Sankalchand and Chandrakant Chimanlal Shah retired. After their retirement the firm was according to the petitioners run by the Joint Hindu Family of Maganlal Ambalal Patel the father of the petitioners Nos. 1 2 and

(3.) It is further pointed out by the petitioners that thereafter on 4 1963 there was a partition in the family of Maganlal Ambalal Patel as a result of which the business under the name of Reliable Engineering Works was carried in partnership between the petitioners Nos. 1 2 and 3 from 4-11-1963. It is said that thereafter the petitioner No. 4 Narandas Somnath Patel was admitted to this partnership as from 25th October 1965 3 It is an admitted position that when the above referred transfer of the business of Azad Moulding Works took place on 1-11-1961 proceedings for assessment of Sales Tax for the period running from dt. 1-4-1958 to 31-3-61 on the turnover of the business done by Azad Moulding Works were pending. However no notice of these proceedings was given to the petitioners at any time after the transfer of the said business took place. It is found that these assessment proceedings were ultimately finalised ex-parte on dt. 9-5-62 but the petitioners knew nothing about the same.