Rebuttable presumption under sales tax transfer provisions fails where only stock goods are purchased, not the business itself.

Liability under section 19(1) of the Orissa Sales Tax Act depends on whether the assessee acquired the entire business, not merely a stock of goods. The explanation creates a rebuttable presumption where business continues in the same premises and in substantially the same goods, but the assessee may displace it by showing absence of transfer of goodwill, rights, liabilities, assets or other business advantages. On the facts recorded by the first appellate authority, no transfer of goodwill or similar business benefits was proved, and that finding remained undisturbed. Section 19(1) was therefore not attracted, and the Tribunal was not justified in fastening liability from the commencement of business.

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Issues: Whether liability under section 19(1) of the Orissa Sales Tax Act, 1947 was attracted on the facts where the assessee purchased only stock of goods and carried on business in the same premises and in similar goods.

Analysis: The explanation to section 19(1) creates a rebuttable presumption where the assessee carries on business substantially in the same goods in the same premises. The initial burden lies on the assessee to show that there was no transfer of the entire business and that no other attributes of the business, such as goodwill, rights, liabilities, assets or similar advantages, were acquired. If such material is produced, the burden shifts to the department. On the facts found by the first appellate authority, there was no transfer of goodwill and other business benefits in favour of the assessee, and that finding was not displaced.

Conclusion: Liability under section 19(1) was not attracted. The Tribunal was not justified in holding the assessee liable from the date of commencement of business, and the answer is in favour of the assessee.

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