- (1.) UNDER Section 22 (3) of the Punjab General Sales Tax Act, 1948, this court required the Sales Tax Tribunal, Punjab, to state the case and refer the following question of law for its opinion : Whether on the facts and in the circumstances of the case it could be held that there was a transfer of the entire business or a succession of the business ?
(2.) THE relevant year is the assessment year 1954-55. Messrs. Santokh Singh Karam Singh prior to 22nd July, 1954, were selling cloth as hawkers. On the 22nd July, 1954, they purchased the entire cloth of the shop of Messrs. Sunam Rai Deviditta Mal. Each piece of cloth was valued and the total price of cloth in the shop was calculated which came to Rs. 1,982-5-9. On this purchase, a sales tax of Rs. 61-15-3 was paid. The total amount thus paid came to Rs. 2,044-5-0. The premises in dispute in which Messrs. Sunam Ral Deviditta Mal were carrying on their cloth shop belonged to the municipal committee. The tenants of these premises, Messrs. Sunam Ral Deviditta Mal also parted with the tenancy rights in favour of Messrs. Santokh Singh Karam Singh, the assessee. Later on, the tenancy rights were acquired by the assessee-firm from the municipal committee. Upto 22nd July, 1954, the rent of the premises was paid by the transferor-firm.
(3.) THE Assessing Authority took the view that the transfer of cloth and the premises by Messrs. Sunam Ral Deviditta Mal to Messrs. Santokh Singh Karam Singh was transfer of business within the meaning of Section 17 of the Act and all purchases made on the registration certificate of the transferor-firm were treated as the gross turnover of the transferee-firm with the result that a tax liability of Rs. 908-13-0 was created. The plea of the assessee-firm (Messrs. Santokh Singh Karam Singh) that there was no transfer of business by Messrs. Sunam Ral Deviditta Mal within the meaning of Section 17 was negatived. On appeal to the Deputy Excise and Taxation Commissioner, the decision of the Assessing Authority was affirmed on the question in dispute, though certain other reliefs were granted to the assessee-firm. The assessee then preferred a revision petition to the Excise and Taxation Commissioner, Punjab, but without success. A further revision petition to the Financial Commissioner, Punjab, also failed. The assessee then made an application under Section 22 (1) of the Act requesting the Financial Commissioner to refer as many as eight questions of law for the opinion of this court. This application was also declined. The assessee then moved an application under Section 22 (2) of the Act and this court passed an order under Section 22 (3) requiring the Tribunal to refer the question of law already set out.;