COMMISSIONER OF SALES TAX Vs. ASHOK SURGICAL CO

JUDGEMENT

(1.) The two questions referred for our decision are as follows :-

(2.) Now, so far as the second question is concerned, the contention of the department appears to be that there was no evidence before the Tribunal to come to the conclusion that the whole object of the respondent was to obtain possession of the vacant premises for starting his business of manufacturing and selling surgical appliances. We are unable to see how it can be said to be so in the face of the circumstances pointed out by the Tribunal that this is a case where there was no evidence for the Tribunal to come to the conclusion which it has reached, viz., that the real object in entering into the transaction was not to transfer any business because there was no business to be transferred, but was to make the premises available to the respondent to enable him to carry on his business of manufacturing and selling surgical goods. The fact that the business of Messrs Pendse and Mandali was already closed six months before the date of transfer is sufficiently eloquent to show that there could be no intention on the part of either party either to sell any business or purchase any business, coupled with the fact that in fact the transferee did not carry on any Kirana business, because there was no business to be carried on and none was intended to be carried on. We fail to see how it could be said that there was no evidence before the Tribunal to come to the conclusion which it has reached, viz., that the real object of the respondent in entering into the transaction dated 2nd December, 1954, was to obtain the right of tenancy of the premises and its occupation to enable the respondent to carry on his own business of manufacturing and selling surgical goods. The second question, therefore, must be answered in the affirmative. Once the conclusion is reached that there was evidence before the Tribunal to come to the conclusion that the whole object of the respondent was to obtain possession of the vacant premises for starting his own business as a manufacturer and seller of surgical appliances and that the recitals in that connection in the transfer deed were false, the answer to the first question is obvious. If there was no intention on the part of either of the parties to transfer business because there was no business to transfer, then the conclusion that the respondent is not a transferee of any business as a result of the transaction dated 2nd December, 1954, within the meaning of section 26 of the Bombay Sales Tax Act, 1953, must follow. We must, therefore, answer the first question in the negative.

(3.) The result is, the first question is answered in the negative, and the second question is answered in the affirmative.