Final civil decree on retirement from partnership barred personal recovery of sales tax arrears against the former partner.

A demand notice for recovery of sales tax arrears could not be enforced against an individual who had retired from the firm, because a civil court decree declaring that he was not a partner from 01.04.1990 had attained finality and bound the respondent. The Court also relied on the earlier principle that, where a minor partner is liable for arrears, recovery can be made only from the minor's assets and not from the natural guardian. In light of those prior determinations, the respondent could not proceed against the petitioner personally for the business arrears, and the impugned notice was quashed against him.

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Issues: Whether the demand notice for recovery of sales tax arrears could be enforced against the petitioner despite the release deed, the civil court decree declaring that he was not a partner from 01.04.1990, and the earlier findings on recovery from a minor's assets.

Analysis: The petitioner's retirement from the firm was upheld by a civil court decree which had attained finality, and that finding bound the respondent who had been a party to the suit. The Court also noted the earlier principle that, if a minor partner were liable for arrears, recovery could be made only from the minor's assets and not from the natural guardian. On that basis, the respondent could not proceed against the petitioner personally for the arrears alleged against the business concern. The impugned notice, issued without regard to these earlier determinations, was therefore not sustainable against the petitioner.

Conclusion: The notice was held unenforceable against the petitioner and was quashed as against him.

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