Discontinuance relief is unavailable where a business is sold but continues under a successor with goodwill and contracts intact.

Section 25(3) relief is available only when a business in existence at the commencement of the Act is actually discontinued. A mere sale or transfer of the undertaking, where the business continues in the hands of the purchaser with its goodwill and contracts intact, is succession under Section 26 and not discontinuance. On that basis, the assessees were not entitled to claim refund under the discontinuance provision because the business itself had not ceased; only ownership had changed.

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Issues: Whether the assessees were entitled to claim refund under Section 25(3) on the footing that the business was discontinued, although the undertaking was sold and continued by the purchaser.

Analysis: Section 25(3) grants relief only where a business in existence at the commencement of the Act is discontinued. On the facts, the business was not brought to an end; only its ownership changed, while the undertaking, including goodwill and contracts, continued in the hands of the purchaser. Section 26 covers succession to a business, and the transfer did not convert the case into one of discontinuance for the purposes of Section 25(3).

Conclusion: The assessees were not entitled to the refund claimed; the issue was decided against them.

Final Conclusion: Mere sale or transfer of a business does not amount to discontinuance where the business itself continues under a successor, so relief under the discontinuance provision is unavailable.

Ratio Decidendi: A business is not discontinued for purposes of the discontinuance relief provision merely because its ownership changes; the decisive question is whether the business itself has ceased, not whether it has ceased in the hands of a particular proprietor.

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