Harbans Singh, J. - (1.) THIS petition challenges two assessment orders dated 27th of March; 1954, by which the Assessing Authority, Ludhiana, assessed M/s. B.S. Aggarwal & Co., Chaura Bazar, Ludhiana, described as a partnership firm, to sales -tax and penalty for the period 1st of March, 1950, to 31st of March, 1951, and 1st of April, 1951, to 30th of June, 1950. According to the Assessing Authority, on receiving information that M/s. B.S. Aggarwal and Company had been engaged in the business of importing and selling of goods in the Punjab State during the years 1950 -51 and 1951 -52 and had become liable to pay sales -tax, a notice in form S -T XIV in accordance with the provisions of section 11(6) of the Punjab General Sales Tax Act was issued on 29th of June, 1953, forgiving an opportunity to the dealers to be heard and produce their books of account etc. Admittedly Banarsi Das Aggarwal petitioner was concerned with this firm B.S. Aggarwal and Company. According to the petitioner he was only one of the partners, He could not be located and his son Om Parkash Gupta, who was separate from the father and carried on separate business, refused to tell his whereabouts. A notice for his appearance on 10th of July, 1953, was pasted on the business premises of M/s. Om Parkash Gupta and Sons. However, on 30th of June, 1953, Banarsi Das appeared before the Assessing Authority and filed a return to the effect that his sales during the year 1950 -51 amounted to Rs. 23,000/ - and during the year 1951 -52 to Rs. 13,000/ - and that the business was closed in June, 1951. The Assessing Authority took the view that he had filed this "voluntary return" only on getting to, know of the notice and, therefore, not only assessed him to tax but also imposed penalty. On an appeal filed by B.S. Aggarwal and Company, the Appellate Authority definitely came to the conclusion that no notice was, in fact, issued and that the disclosure was voluntary and, consequently, the penalty could not be imposed. Later, on the petitioner further approaching the Excise and Taxation Commissioner, the amount of assessment was also reduced.
(2.) THE main point taken in this petition, however, is that the firm having been dissolved as far back as June, 1951, the Assessing Authorities had no jurisdiction to assess the firm after such dissolution. For this, reliance was placed on a Full Bench ruling of this Court reported in M/s. Jullundur Vegetable Syndicate v. Punjab State, (1962) 64 P. L.R. 35. As is clear from the assessment orders, it is the case of the department itself that M/s. B.S. Aggarwal and Company did business only between the period 1st of March, 1950, to 30th of June, 1951. In the assessment orders the status of the assessee was shown as "partnership firm". In the order of the Appellate Authority (annexure 'C'), it is stated as follows: - The position of the department was and is that the appellant concealed a number of transactions by carrying these on through the firm of Shri Om Parkash Gupta. Since the appellant firm is a partnership concern in which the partner other than Shri Banarsi Das is not a member of the Hindu undivided family, of which Shri Banarsi Das and Shri Om Parkash Gupta are members, there could be no question of a joint assessment of the appellant firm and the firm of Shri Om Parkash Gupta (which incidentally is a firm already registered). The entire circumstances actually lend support to the conclusion that Shri Banarsi Das, one of the partners of the appellant firm, was, as alleged by the department, actually carrying on certain transactions through the firm of Shri Om Parkash Gupta. Again, there is an interim order of the Deputy Excise and Taxation Commissioner dated 19th of April, 1954, it is stated - The amount of tax involved in this case is Rs. 3,027/6/6. The amount is fairly heavy. The firm has since ceased to exist. I, therefore, entertain the appeal without payment of tax. This order (copy annexure 'E') apparently relates to the year 1950 -51. No doubt Banarsi Das Aggarwal is described in the order of the learned Excise and Taxation Commissioner at some places as the proprietor of M/s. B.S. Aggarwal and Company while at other places mention is made of Banarsi Das taking time to produce accounts showing certain figures for which he had written to his partner in Calcutta. The argument of the learned counsel for the petitioner, therefore, was that throughout the proceedings, the department had been treating B.S. Aggarwal and Company as a firm of partnership and admittedly it had ceased to exist since June, 1951, and that in view of the Full Bench decision the assessment is bad. Prima facie, there seems to be considerable force in the argument of the learned counsel for the petitioner.
(3.) ON the other side, however, on behalf of the department it was vehemently urged that the petitioner did not raise this point any where before the authorities. The obvious reason for this is that the law was not clear till the decision of the Full Bench, referred to above. That, however, does not change the position if at the time when the assessment was made, the firm was not in existence and, therefore, the department had no jurisdiction to make such an assessment.;