JUDGMENT Mootham, C.J.
1. This is an appeal from a judgment of Mr. Justice Chaturvedi dated the I7th January, 1955, dismissing a petition under Article 226 of the Constitution.
2. In 1948 the appellant entered into partnership with two other persons, Amar Nath and Kedar Nath, for the purpose of dealing in bullion and ornaments and in forward contracts in gold and silver. The business was carried on under the name of Messrs. Bans Gopal Amar Nath and each of the three partners had a one-third share. On the 16th July, 1950, Amar Nath retired from the partnership and on the following day the firm was reconstituted, the name being changed to Messrs. Bans Gopal Kedar Nath and the partners being the appellant and Kedar Nath each of whom had a half share. The reconstituted firm carried on the business previously conducted by the former firm and took over the assets and liabilities of the latter. The firm of Bans Gopal Kedar Nath did not succeed financially and disputes having arisen between the partners the firm was dissolved on the 18th April, 1952, from which date it discontinued business. By assessment order dated the 19th July, 1952, the Sales Tax Officer, Etawah, who is the first respondent, determined the turnover of the firm Bans Gopal Amar Nath for the period 1st April, 1950, to 16th July, 1950, at Rs. 64,636-5-6 and the sales tax payable by that firm at Rs. 1,005-4-3. The respondent Sales Tax Officer by a further assessment order dated the I7th May, 1953, determined the turnover of the firm Bans Gopal Kedar Nath for the assessment year 1951-52, that is, from the 1st April, 1951, to the 31st March, 1952, at Rs. 80,000 and the tax payable at R,s. 1,250. The appellant filed an appeal against the second of these assessment orders and that appeal, we are informed, is pending before the Judge Appeals, Sales Tax. In February, 1954, the respondent Sales Tax Officer took steps under Section 8 of the Act for the recovery of the tax assessed in respect of the assessment year 1951-52. Section 8 provides that in default of payment the amount of tax may be recovered as if it were an arrear of land revenue, and on the I3th February, 1954, the respondent Sales Tax Officer issued a certificate under that section addressed to the Collector, Etawah, who is the second respondent, requesting the latter to recover the sum of Rs. 1,250 from the appellant who was described in the certificate as a partner in the firm Bans Gapal Kedar Nath. The appellant thereupon filed the petition out of which this appeal arises challenging the validity of the assessment orders dated the 19th July, 1952, and the 17th March, 1953, and praying that those orders be quashed and that the respondent Sales Tax Officer be directed to withdraw his certificate under Section 8 of the Act. The learned Judge was of opinion that the two assessment orders were valid orders and he accordingly dismissed the petition.
3. The appellant's principal contention is that a partnership firm cannot, after it has been dissolved, be assessed to sales tax. It was further argued, although the point was not very strongly pressed, that even if such an assessment can be made the tax cannot be recovered from the persons who were partners of the firm at the time of its dissolution.
4. Now both orders of assessment in the present case were made after the date upon which it is admitted that the reconstituted firm Bans Gopal Kedar Nath ceased to exist; and in each case the Sales Tax Officer sought to assess not the partners of the dissolved firm but the firm itself. Nothing in our opinion turns on the fact (for such it appears to be) that notice was not given to the assessing authority of the dissolution of the firm Bans Gopal Kedar Nath, for it is no part of the respondent's case that had such notice been given steps would have been taken to assess the former partners of the firm. The respondent's case is that the unit of assessment continued to be the firm notwithstanding the fact that it had been dissolved.
5. Sales tax is payable under Section 3 of the U.P. Sales Tax Act, 1948, by a dealer, and "dealer" is defined in Section 2, clause (c), as "any person or association of persons carrying on the business of buying or selling goods in Uttar Pradesh...and includes any firm or Hindu joint family and any society, club or association, which sells goods to its members;...." It is no doubt true that under the Indian Partnership Act, 1932, a firm has no legal existence, but this Court has held in Shri Hira Lal Barman and Ors. v. The Sub-Divisional Officer, Hathras and Anr., Writ Petition No. 1025 of 1954 decided on the 7th February, 1956, that under the Sales Tax Act, as under the Income-tax Act, a, firm is a separate unit of assessment and to this extent it is distinguishable from its partners. There appears to be no good reason why a firm which carried on business in the accounting year should escape payment of sales tax by dissolution before it has been assessed, and this aspect of the matter clearly influenced the learned Judge. The question is however whether the Act makes provision for the assessment and collection of tax in such circumstances. In our opinion it does not.
6. The position which arises on the dissolution and discontinuance of a firm is analogous to that which arises on the disruption of a Hindu joint family. A difficulty arose under the Income-tax Act when an undivided family had received income in the year of account but was no longer in existence as such at the time of assessment. That difficulty was met by the introduction into the Act of Section 25A. Unless however the provisions of this section have application proceedings cannot be taken against a Hindu joint family after it is separated as the joint family has ceased to exist. Thus it has been held that proceedings under Section 28 of the Income-tax Act, a section which authorises the Income-tax authorities to impose a penalty for concealment of income, cannot be instituted against a Hindu joint family after the joint family had by separation ceased to exist: Commissioner of Income-lax, Bihar and Orissa v. Sanichar Sah Bhim Sah [1955] 27 I.T.R. 307; S.A. Raju Chettiar v. Collector of Madras [1956] 29 I.T.R. 241. So also a former Hindu joint family cannot be assessed to excess profits tax if there has been a, separation before the order of assessment is made as the family has then ceased to exist and the Excess Profits Tax Act contains no provision corresponding to Section 25A : Commissioner of Excess Profits Tax, Madras v. J ivaraj Topun and Sons, Madras [1951] 20 I.T.R. 143. In the recent case of Manindra Lal Goswami v. Income-tax Officer [1956] 30 I.T.R. 550 a learned Judge of the Calcutta High Court has held that there is no provision in the Income-tax Act which enables a firm to be assessed after its discontinuance or dissolution.
7. In our judgment an assessment order cannot be made under the U.P. Sales Tax Act on a firm after it has dissolved and has discontinued business on the short ground that the firm as a unit of assessment has ceased to exist.
8. We are therefore of opinion that this appeal must be allowed and a writ must issue quashing the order of assessment dated respectively the 19th July, 1952, and the 17th March, 1953, and quashing also the certificate of the Sales Tax Officer dated the 6th/13th February, 1954, addressed to the Collector, Etawah. The appellant is entitled to his costs which we assess at Rs. 100.