Transfer of business under sales tax law requires more than stock purchase; no transferee liability arose here.

Liability under section 33(1) of the Madhya Pradesh General Sales Tax Act, 1958 arises only on an actual transfer of the ownership of a dealer's business, meaning transfer of the running business as such with its rights, liabilities, stock-in-trade and goodwill. A mere purchase of stock-in-trade does not amount to transfer of business, even if some liabilities are paid out of the sale consideration. On the facts, there was no evidence of transfer of contracts, commitments or goodwill, and the purchaser's engagement in the same line of business did not establish transfer of the business. The purchaser was therefore not treated as a transferee of the business and was not liable for the former dealer's tax and penalty.

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Issues: Whether the petitioner became liable under section 33(1) of the Madhya Pradesh General Sales Tax Act, 1958, as transferee of the ownership of the dealer's business when he purchased only the stock-in-trade and certain liabilities were discharged out of the sale consideration.

Analysis: Liability under section 33(1) arises only when the ownership of the business of a dealer liable to pay tax is entirely transferred. A transfer of business means transfer of the running business as such, along with its rights, liabilities, stock-in-trade, and goodwill, and not merely a sale of goods or materials. On the facts found, the record showed only a purchase of stock-in-trade; the alleged liabilities were discharged by the transferor itself from the consideration received; there was no evidence of transfer of contracts, commitments, or goodwill; and the mere fact that the petitioner was engaged in the same line of business did not establish transfer of the business.

Conclusion: The petitioner was not a transferee of the ownership of the business and was not liable under section 33(1) for the tax and penalty payable by the former dealer.

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