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Issues: Whether sales tax assessed on a firm could be recovered from a partner after the firm had been dissolved and whether the dissolution of the firm extinguished the tax liability for which demand had been made.
Analysis: The Act treated a firm as a dealer and a separate unit for assessment, but the Court held that dissolution did not wipe out the liability that had already accrued in respect of the firm's business during the relevant assessment years. The absence of an express provision in the sales tax law for recovery from the partners of a dissolved firm was held not to defeat recovery, because the partners remained liable for the firm's obligations and the process of assessment and collection formed part of winding up the firm's affairs. The Court preferred the view taken in earlier decisions of this Court that arrears of sales tax due from a dissolved firm could be enforced against the partner.
Conclusion: The demand and recovery proceedings against the petitioner were valid, and the writ petition failed.
Ratio Decidendi: Where a taxing statute treats a firm as a dealer and tax liability has accrued during the firm's existence, dissolution of the firm does not extinguish the liability, and recovery may be enforced against the partners notwithstanding the absence of an express recovery provision.
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