Transferee tax liability requires proof of complete business transfer; earlier assessment findings do not bar a fresh recovery inquiry.

Sales tax liability under section 17 of the Bihar Sales Tax Act, 1944 can be enforced against a transferee only where ownership of the registered dealer's business has been entirely transferred and that factual basis is specifically found. In the absence of a finding that the whole business was transferred, recovery could not be made from a person who had not been assessed as the dealer. An earlier declaration of liability for another assessment period did not operate as res judicata for the present recovery proceedings, because each assessment period is distinct and required an independent determination of transferee status. The recovery order was therefore unsustainable and the matter required reconsideration after notice and evidence.

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Issues: (i) Whether sales tax assessed against the Hindu undivided family could be recovered from the appellant as a transferee under section 17 of the Bihar Sales Tax Act, 1944 in the absence of a finding that the entire business had been transferred. (ii) Whether an earlier declaration of liability for another assessment period could operate as res judicata for the present recovery proceedings.

Issue (i): Whether sales tax assessed against the Hindu undivided family could be recovered from the appellant as a transferee under section 17 of the Bihar Sales Tax Act, 1944 in the absence of a finding that the entire business had been transferred.

Analysis: Liability to sales tax is statutory and can be enforced only in the manner provided by the Act. Section 17 fastens liability on a transferee only when the ownership of the business of a registered dealer is entirely transferred. In the present case, the authorities did not record a finding that the whole business had been transferred to the appellant, and the recovery proceedings were initiated against a person who had not been assessed as the dealer.

Conclusion: The tax assessed against the Hindu undivided family could not be enforced against the appellant without the requisite finding of entire transfer, and this issue was decided in favour of the appellant.

Issue (ii): Whether an earlier declaration of liability for another assessment period could operate as res judicata for the present recovery proceedings.

Analysis: Each assessment period is distinct. A determination relating to one period does not automatically govern liability for a different period, particularly when the present proceedings required an independent finding on the appellant's status as transferee.

Conclusion: The earlier proceeding did not bar examination of the present liability, and the issue was not resolved against the appellant on any res judicata basis.

Final Conclusion: The recovery order could not stand because the necessary factual finding supporting transferee liability was absent, so the matter had to be reconsidered by the High Court after notice and evidence.

Ratio Decidendi: Statutory tax liability can be recovered from a transferee only where the statute's conditions for transfer-based liability are satisfied and are supported by a specific finding on the facts; an assessment for one period does not automatically conclude liability for another period.

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