Control order transactions may still be sales if property passes for consideration with mutual assent and contractual freedom.

Section 17 of the Bengal Finance (Sales Tax) Act, 1941 applies only where the ownership of a registered dealer's business is absolutely transferred; a managing contractor arrangement that leaves the principals' ownership intact and limits the transferees to management does not satisfy that condition. For transactions under the Colliery Control Order, 1945, a sale under section 2(g) still depends on transfer of property in goods for consideration with contractual assent; regulation by a control order does not by itself exclude sale. Whether particular transactions lacked mutuality or contractual freedom had to be examined on their facts, so the assessment notice was not premature and the challenge failed.

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Issues: (i) Whether the managing contractor agreement effected an absolute transfer of the ownership of the registered business so as to attract section 17 of the Bengal Finance (Sales Tax) Act, 1941. (ii) Whether the transactions made under the Colliery Control Order, 1945 were sales within section 2(g) of the Bengal Finance (Sales Tax) Act, 1941 so as to sustain the assessment notice.

Issue (i): Whether the managing contractor agreement effected an absolute transfer of the ownership of the registered business so as to attract section 17 of the Bengal Finance (Sales Tax) Act, 1941.

Analysis: Section 17 applies only when the ownership of the business of a registered dealer is transferred absolutely. The agreement in question described the transferees as managing contractors, expressly stated that no interest in the coal land or colliery was being transferred, and confined them to management and work on behalf of the principals. On its terms, the document did not divest the principals of ownership of the business.

Conclusion: The requirement of absolute transfer was not satisfied and the challenge under section 17 failed in favour of the Revenue.

Issue (ii): Whether the transactions made under the Colliery Control Order, 1945 were sales within section 2(g) of the Bengal Finance (Sales Tax) Act, 1941 so as to sustain the assessment notice.

Analysis: A sale under section 2(g) requires transfer of property in goods for consideration, with the elements of contract and mutual assent. Control orders do not automatically exclude a sale; the decisive question is whether the statutory directions in a given transaction destroyed contractual freedom and mutuality. That inquiry could not be answered abstractly at the notice stage, because each transaction and the actual directions under the Control Order had to be examined before deciding whether the transactions were sales.

Conclusion: The notice of assessment could not be quashed as premature, and the challenge to it failed in favour of the Revenue.

Final Conclusion: The application was not maintainable on either ground and the impugned order and assessment notice were upheld.

Ratio Decidendi: A transaction governed by a control order is not excluded from the concept of sale merely because it is regulated by statute; the decisive test is whether, on the facts of the particular transaction, ownership passed for consideration with mutual assent and sufficient freedom of contract.

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