Dissolution intimation is enough: a partnership firm cannot be assessed after dissolution without a statutory proof requirement.

Under the Bengal Finance (Sales Tax) Act, 1941 and the relevant rules, intimation of a firm's dissolution was sufficient where no further proof was required. A dissolved partnership firm could not be treated as liable for assessment proceedings initiated after dissolution merely because the taxing authority had not formally accepted the change in constitution. On that basis, continued assessment against the former partners on the footing that the firm still existed was not sustainable, and the demand was invalid.

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Issues: Whether a sales tax assessment could validly be made against a partnership firm after its dissolution and whether the demand could be recovered from the former partners when intimation of dissolution had been given to the taxing authority.

Analysis: The firm was a registered dealer under the Bengal Finance (Sales Tax) Act, 1941, and the relevant rules required intimation of any change in constitution or dissolution. The dissolution had admittedly been intimated to the authority, and the rules did not require the taxpayer to produce further proof as a condition for recognition of the change. In a fiscal statute, the language must be strictly construed, and where the assessment proceedings were initiated after dissolution, the dissolved firm could not be treated as liable merely because the department had not accepted the dissolution on its own satisfaction. The absence of any statutory requirement for proof of dissolution meant that the department could not continue assessment proceedings against the former partners on the footing that the firm still existed.

Conclusion: The assessment and demand against the petitioners were invalid and were quashed; the petition succeeded in favour of the petitioners.

Final Conclusion: A dissolved partnership firm cannot be assessed after dissolution merely because the tax authority has not formally recognised the dissolution, where the statute and rules require only intimation and no further proof.

Ratio Decidendi: In the absence of a statutory requirement to furnish proof of dissolution, timely intimation of dissolution to the taxing authority is sufficient, and a partnership firm dissolved before initiation of assessment proceedings cannot be validly assessed for that period.

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