Operative deed prevails over inconsistent recitals; business succession under sales tax law arises only on execution of the transfer instrument.

An executory agreement did not itself transfer the firm's business, assets or liabilities; the later indenture of assignment was the operative instrument that effected the transfer. Where recitals in a deed conflict with an unambiguous operative clause, the operative part prevails. The earlier date in the recitals was treated only as the date from which the parties accounted for assets, liabilities and business dealings, not as the date of legal succession. For registration under section 19 of the Bombay Sales Tax Act, 1959, the statutory right and liability arose only on transfer by succession, which occurred when the assignment deed was executed.

---

---

Issues: Whether the applicant was entitled to registration as a dealer with effect from 5 November 1965, on a true construction of the agreement dated 14 June 1965 and the indenture of assignment dated 5 November 1965.

Analysis: The agreement of 14 June 1965 was merely executory and did not itself transfer the business or any of its assets and liabilities. The subsequent indenture of assignment of 5 November 1965 was the instrument by which the business of the firm, together with its assets and liabilities, was actually transferred. Where the recitals in a deed are inconsistent with an unambiguous operative part, the operative part must prevail. The earlier date mentioned in the recitals only reflected the date from which the parties treated certain assets, liabilities and business dealings as having been taken over for accounting purposes. The statutory liability and the right to registration under section 19 of the Bombay Sales Tax Act, 1959, arose only on succession by transfer, and that succession occurred on execution of the assignment deed.

Conclusion: The applicant was not entitled to registration effective from 5 November 1965; the transfer took effect only on 5 November 1965, and the reference was answered against the applicant.

Ratio Decidendi: In construing a deed, an unambiguous operative part prevails over inconsistent recitals, and for purposes of succession under the sales tax law, a transfer of business takes effect only when the operative instrument of transfer is executed.

---