Transfer of business does not extinguish sales tax liability; transferor remains liable, with transferee's liability only supplementary.

Section 17 of the Bengal Finance (Sales Tax) Act, 1941 does not extinguish the transferor's pre-existing sales tax liability on transfer of a business. The provision treats the transferee as the registered dealer for the Act's purposes and makes the transferee concurrently and supplementarily liable for unpaid liabilities, but it preserves the original liability of the person who incurred the tax. The transferor remains bound to comply with assessment and recovery notices, and arrears already incurred may still be enforced in certificate proceedings against the transferor. The Calcutta HC therefore rejected the contention that transfer of the business absolved the transferor from outstanding sales tax dues.

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Issues: Whether transfer of the business under section 17 of the Bengal Finance (Sales Tax) Act, 1941, absolved the transferor from liability for outstanding sales tax dues already incurred and recoverable under the certificate proceedings.

Analysis: Section 17 creates a legal fiction by which the transferee is treated as the registered dealer for the purposes of the Act and becomes liable for liabilities not already discharged, but the wording does not extinguish the transferor's existing liability. The provision operates as an additional safeguard for revenue and preserves the original liability of the person who incurred the tax. The Court held that the transferor's duty to comply with notices and to discharge assessed liabilities does not end merely because the business is transferred, and the transferee's liability is concurrent and supplementary rather than exclusive. On that construction, the certificate for arrears could still be enforced against the transferor.

Conclusion: The transfer did not absolve the transferor from liability, and the objection to recovery failed.

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