Tarun Kumar Basu, J.
1. In this application the petitioner, National Jute ., Unit Alexandra, challenges an order of the Commercial Tax Officer, Lyons Range Charge, dated 18th March, 1981. The fact relating to the passing of the impugned order may be briefly stated.
2. By a Central Act called the Jute Companies (Nationalisation) Act, 1980 (No. 62 of 1980) (hereinafter referred to as the Act), the undertakings of jute companies whose names appear in the First Schedule to the Act were nationalised. It appears that by virtue of Section 3 of the said Act those undertakings stood vested in the Central Government on the appointed day.
3. By virtue of Section 6 of the Act the undertaking which vested in the Central Government appear to have, by operation of law, vested in the petitioner-Corporation.
4. Thereafter the petitioner made an application for registration under the provisions of the Bengal Finance (Sales Tax) Act, 1941 (hereinafter referred to as the Sales Tax Act). The impugned order was passed on the petitioner's application for new registration. The material portion of the impugned order is in the following terms :
Thus the business of the jute company seems to have been transferred absolutely. In these circumstances the present application of the dealer cannot be entertained. The representatives of the dealer are directed to apply for treating the dealer as transferee under Section 17 of the Bengal Finance (Sales Tax) Act, 1941.
5. This order directing the petitioner to apply under Section 17 of the Sales Tax Act as transferee for the purposes of registration is challenged before me in this application.
6. Mr. Soumen Bose, the learned Advocate appearing for the petitioner, drew my attention in the first place to the provisions of Section 17 of the Sales Tax Act which are in the following terms :
Section 17. Where the ownership of the business of a registered dealer is transferred absolutely by sale, gift, bequest, inheritance or otherwise or transferred by way of lease and the transferee or the lessee carries on such business, either in its old name or in some other name, the transferee or the lessee shall for all the purposes of this Act (except for liability under this Act already discharged by such dealer) be deemed to be and to have always been registered (in the case of a lease for so long as the lease subsists) as if the registration certificate of such dealer had initially been granted to the transferee or the lessee; and the transferee or the lessee shall on application to the Commissioner be entitled to have the registration certificate amended accordingly.
7. As pointed out by Mr. Bose and as is well-known, Section 17 of the Sales Tax Act and its counterpart in the various statute laws on the subject was enacted to prevent the evasion of sales tax by a dealer by transferring his business. In other words Section 17 makes it possible for the authorities in the event of a transfer of the business to make the transferee liable for all the unrealised sales tax that may be recovered from a transferor.
8. In this background, it may be useful to analyse the provisions of the Act on this question. Section 5(1) of the Act provides as follows :
Every liability other than the liability specified in Sub-section (2), of a jute company in respect of any period prior to the appointed day, shall be the liability of that company and shall be enforceable against it, and not against the Central Government, or, where the undertakings of the jute company vest in the Jute Manufacturers Corporation, against that corporation.
Section 5(2) of the Act provided that any liability arising in respect of loans advanced by the Central Government or any State Government shall be the liability of the Central Government or the corporation.
9. It is clear from the provisions of Section 5(1) of the Act that any liability of a jute company for any period prior to the appointed day is, by the scheme of that section, clearly intended to be a liability of the jute company and not- that of the Central Government or the corporation. This, it is obvious, is clearly contrary to the provisions of Section 17 of the Sales Tax Act. Section 17 of the Act is also relevant for our purpose and may be set out herein below :
Every person having a claim against a jute company with regard to any of the matters specified in the Second Schedule, pertaining to any undertaking owned by it, shall prefer such claim before the Commissioner within thirty days, from the specified date:
Provided that if the Commissioner is satisfied that the claimant was prevented by sufficient cause from preferring the claim within the said period of thirty days, he may entertain the claim within a further period of thirty days but not thereafter.
10. The Second Schedule which is referred to in Section 17 of the Act is headed 'Order of priorities' and is divided into Part I and Part II. Category IV in Part II contains as the first item revenue and taxes.
11. It is clear therefore from Section 17 of the Act read with the Second Schedule that any claim for any tax or revenue can be made before the Commissioner of Payments in the manner laid down in Section 17 of the Act. This, in my view, clearly postulates, that any claims in respect of any taxes from the fiscal authorities which had accrued prior to the appointed day and for which the liability is of the jute company under Section 5 of the Act can be made in the manner laid down in Section 17 of the Act read with the Second Schedule. This scheme again is quite clearly contrary to the scheme of liability under Section 17 of the Sales Tax Act.
12. For the above reasons, the conclusion is inescapable that Section 17 of the Sales Tax Act can have no manner of application to all liabilities of a jute company prior to the appointed day by reason of the clear scheme of the Act. It would necessarily follow that the petitioner cannot by any stretch of imagination be called a 'transferee' within the meaning of Section 17 of the Sales Tax Act. Mr. S.N. Dutta, appearing on behalf of the respondents, contended before me that the expression 'or otherwise' in Section 17 of the Sales Tax Act which follows the various other modes of transfer indicated transfer by operation of law. Having regard to my finding on the other points I do not consider it necessary to come to any definite conclusion on this aspect of the matter in the present case. I must, however, say that the acquisition of a jute mill in exercise of the power of eminent domain appears to be totally foreign to the concept of transfer generally.
13. Mr. Soumen Bose appearing on behalf of the petitioner drew my attention to a decision of the Calcutta High Court in the case of Shethia Mining and . v. Commercial Tax Officer, Central Section, reported in [1977] 39 STC 246. There Sabyasachi Mukharji, J., on a consideration of the provisions of the Coal Mines (Taking Over of Management) Ordinance, 1973, Coal Mines (Taking Over of Management) Act, 1973, and Coal Mines (Nationalisation) Act, 1973, appears to have come to the conclusion that nationalisation under the provisions of the last mentioned Act does not amount to a transfer within the meaning of Section 17 of the Sales Tax Act. Similarly in the case of Western Coal Fields Ltd. v. Sales Tax Officer, Sambalpur III Circle, reported in [1977] 40 STC 225, a Division Bench of the Orissa High Court appears to have come to a similar conclusion.
14. Mr. S.N. Dutta sought to distinguish the above cases on the ground that by virtue of the Act the undertakings of the jute company had been nationalised whereas under the Coal Mines (Nationalisation) Act, 1973, the entire company has been nationalised. Mr. Soumen Bose appearing for the petitioner, however, contends that both under the Coal Mines (Nationalisation) Act and also under this Act the undertaking of the respective company stood nationalised.
15. Having regard to my findings on the principal question I am not inclined to elaborate this aspect but I merely record the contention.
16. In view of what I have stated already it must follow that Section 17 of the Sales Tax Act has no manner of application to the present case and as such the Commercial Tax Officer was manifestly in error in directing the petitioner to apply as a transferee under Section 17 of the Sales Tax Act.
17. In the result, this application succeeds and the rule is made absolute. There will be a writ in the nature of certiorari quashing the impugned order dated 18th March, 1981, which is annexure G to the petition, and a writ in the nature of mandamus directing the respondents to forbear from giving any effect thereto in any manner whatsoever. The respondents are directed to dispose of the pending application of the petitioner in accordance with law and in the light of the observations made herein. There will be no order as to costs.
In re : National Jute . (2nd application).
18. In view of my judgment delivered today in M/s. National Jute ., Unit Alexandra, (1st application) this rule must be made absolute. There will be writ in the nature of certiorari quashing the order dated 18th March, 1981, being annexure H to the petition, and a writ in the nature of mandamus directing the respondents to forbear from giving effect in any manner whatsoever. The respondents are also directed to dispose of the pending appli-cation of the petitioner for registration according to law and in the light of the observations indicated in the above judgment. There will be no order as to costs.
In re: National Jute ., Unit Alexandra
(3rd application).
19. In view of my judgment delivered today in the case of M/s. National Jute . (1st application), this rule must be made absolute. There will be a writ in the nature of certiorari quashing the impugned order dated 18th March, 1981, which is annexure H to the petition, and a writ in the nature of mandamus directing the respondents to forbear from giving any effect in any manner whatsoever. The respondents are also directed to dispose of the pending application of the petitioner for registration in accordance with law and in the light of the observations indicated in the above judgment. There will be no order as to costs.
20. Stay of operation of the order is prayed for and is refused.