9911796707
TMI Blog1965 (7) TMI 51X X X X Extracts X X X X X X X X Extracts X X X X ..... PR-85 was issued to it; that in the application which the joint family firm made for registration, the principal place of business was mentioned as "Mangalchand Bhikamchand, Gotegaon" and the additional place of business was stated to be "Komalchand Bhupendrasingh, Ramward, Kandeli town (Narsinghpur Tehsil)"; that the additional place of business did not identify the business of "Komalchand Bhupendrasingh" as business of the joint family firm; that the firm of "Komalchand Bhupendrasingh" had a separate existence by itself and was doing business under a separate registration certificate bearing No. NPR-200; that on or about 6th November, 1953, the joint family disrupted and the four petitioners thereafter formed a partnership by a deed dated the 26th February, 1954, and since then were doing business in the name of Mangalchand Bhikamchand; that the liability of this partnership firm was limited to their own dealings; that they could not be made liable for any liability of any other person or persons in respect of any period; and that the joint family firm or the partnership firm after its constitution did not do any business at the additional address. The petitioners further say tha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s is that in the application dated 3rd August, 1947, which the joint family made under section 8 of the 1947 Act for registration of its business, it was stated that the petitioners as members of the joint family had interest in the firm Komalchand Bhupendrasingh and the additional place of business was shown to be "Komalchand Bhupendrasingh, Ramward, Kandeli (Narsinghpur Tehsil)"; and that the registration certificate No. NPR-85, which was issued to the joint family, also permitted it to do business free of tax for purposes of manufacture for sale, for re-sale and for use in the execution of contracts, not only in grains and kirana but also in silver and gold, and the additional place of business was stated therein to be "Komalchand Bhupendrasingh, Ramward in Kandeli town (Narsinghpur Tehsil)". The opponent, while not disputing that the partnership deed was executed on 26th February, 1954, showing the four petitioners as partners, has made the following statement in the return with regard to the petitioners' partnership"It is not clear from the deed of partnership as to what happened to the family business carried on under the name and style of Mangalchand Bhikamchand, Bhikamchand ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... titioners were liable to pay the amount as dealers or otherwise was even recorded by the Sales Tax Officer. In stating at various places in the return that there is enough material to justify the recovery of the amount from the applicants, the Sales Tax Officer had only exhibited the obscurity and confusion in his mind about his functions as Sales Tax Officer and as Tehsildar. A Tehsildar, before whom proceedings for the recovery of tax amount as arrears of land revenue have been initiated in accordance with law, no doubt cannot entertain any objection of the person, from whom the amount is sought to be recovered, that he is not liable to pay the amount. But before any such proceedings can be started, there must be a valid authorisation for it, and that consists in an order of the competent authority, here the Sales Tax Officer, holding the person liable for the payment of the amount on some legal basis and finding default in the payment of the amount by the person held so liable. At the stage when the liability of a person for payment of an amount is under determination, the Sales Tax Officer is bound under the provisions of the Act of 1947, as also under the Act of 1958 and even ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the whole of the money if it is equal to or less than the amount due. The section also prescribes the procedure that must be followed before such a person can be called upon to pay the amount. It also provides in subsection (5) thereof that if the person on whom a notice has been served under sub-section (1) proves to the satisfaction of the officer issuing the notice that the sum demanded or any part thereof was not due to the dealer, or that he did not hold any money for or on account of the dealer at the time when the notice was served on him, then nothing contained in section 23 shall be deemed to require him to pay any amount. Sub-section (5) thus contemplates hearing of objections of the person from whom the tax amount is demanded under section 23. It is noteworthy that though the petitioners' averment about the recovery purporting to be one under section 23 of the Act of 1958 has been admitted in the return of the respondent by making the statement: "it is admitted that this respondent has issued warrant of recovery for the amount of Rs. 8,467-44 P. as alleged" (underlining ours*), not a word has been said in the return showing the applicability of the provisions of section ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t the firm Komalchand Bhupendrasingh as in the application for registration, which was made by the petitioners' joint family, the additional place of business of the joint family was stated to be Ramward (Kandeli town) and that the certificate of registration issued to the joint family distinctly mentioned this place as an additional place of business, and also referred to the fact that the joint family was doing business in silver and gold. If the business done by the firm Komalchand Bhupendrasingh was really the business of the joint family and the certificate of registration issued to the joint family mentioned this, then one would have expected the turnover of the firm Komalchand Bhupendrasingh included in the turnover of the joint family for purposes of assessment. But nothing has been said in the return to show whether the joint family submitted a consolidated return for all the places of its business and whether in the assessment made against the joint family its turnover of any business done in gold and silver at Ramward was or was not included. If on account of some mistake or oversight the turnover of the firm Komalchand Bhupendrasingh, which is now said to be really the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e member and if the joint family business has been transferred to a firm or association, then the tax payable by a member of the joint family can be recovered from the transferee as laid down in the first proviso to sub-section (4). 8.. From what has been stated above, it is plain that an order of assessment against the joint family making it liable in the sum of Rs. 8,467.44 P. in respect of the transactions effected at Ramward in the name of the firm Komalchand Bhupendrasingh was necessary before any proceedings for recovery of the amount could be initiated against the petitioners, whether as members of the joint family or as partners of the firm to whom the joint family business had been transferred. In the absence of any such valid assessment order, the recovery proceedings initiated by the opponent against the petitioners cannot be sustained. 9.. For the foregoing reasons, our conclusion is that the recovery proceedings started by the opponent-Sales Tax Officer against the petitioners are wholly illegal and without jurisdiction and must be quashed by the issue of a writ of certiorari. 10.. Before parting with this case, we must say that the present case is a typical inst ..... X X X X Extracts X X X X X X X X Extracts X X X X
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