G.C. Das, J.
1. The following two questions were referred to this Court by the Member, Sales Tax Tribunal, Orissa, under Sub-section (1) of Section 24 of the Orissa Sales Tax Act :-
(1) Whether under the provision of Sub-section (1)of Section 19 of the Orissa Sales Tax Act, 1947, a transferee of a business from a registered dealer cannot be held liable to assessment and payment of tax in respect of the said business for periods prior to the date of transfer for which the business remained unassessed and consequently the tax thereon remained unpaid by the transferor ?
(2) Whether a transferee within the meaning of section 19(1) of the Act cannot be made liable to pay sales tax from the date of the transfer without determination of his liability under the provisions of Section 4 of the Act as contemplated under Section 19(2) of the Act?
2. The facts giving rise to this reference are these ; The dealer-assessee was taxed under Section 12(4) of the Orissa Sales Tax Act for the quarters ending on 30th June, 1953, to 31st December, 1954. One Banambar Sahu Chaudhury was a registered dealer under the Orissa Sales Tax Act. He was running a hotel under the name 'City Restaurant'. He transferred the business to the dealer-assessee (hereinafter referred to as 'the assessee') on 16th June, 1953. The assessee, however, did not return his turnovers in respect of the quarters mentioned above. Treating the assessee liable as a registered dealer, the assessing officer started a proceeding under Sub-section (4) of Section 12 of the Act against him and determined his gross turnover at an estimated amout of Rs. 2,700 for all the three quarters. Applying the old Rule 65, he determined the taxable turnovers and assessed him accordingly. On appeal, the Assistant Collector confirmed the assessment. There was some controversy as to whether the entire business was transferred or not. The Tribunal came to the conclusion that the transfer of the business was in its entirety to the assessee on 16th June, 1953. After finding this, the Tribunal held that the assessee though remaining liable for any sales tax that remained unpaid by the transferor up to the date of transfer, is not liable to be assessed and taxed under Section 19(1) of the Act. He also held that except for the assessee's liability to pay the amount of tax that remained unpaid by the transferor till the date of transfer, the liability of the transferee from the date of transfer is to be determined under the provisions of the charging Section 4 as enjoined under Section 19(2) of the Act, Thus, in the absence of a proceeding against the transferor for assessment, quantification of the demandable sales tax and ultimate determination of the amount of tax that remained unpaid by the trasferor till the date of transfer, the Tribunal annulled the assesement for the quarter ending on 30th June, 1953. In the absence of determination of the liability of the transferee-dealer-assessee under the provisions of Section 4 of the Orissa Sales Tax Act, the Tribunal set aside the assessments, and directed fresh assessment according to law. The Tribunal appears to have taken the correct view of the law, but he seems to have gone wide off the mark. In that connection, I would like to state the scheme of the Act. Section 4 is the charging section. Thereafter Section 5 deals with the rate of tax and Sub-section (1) lays down that the tax payable by a dealer under this Act shall be levied at the rate of one quarter of an anna in the rupee on his taxable turnover. Returns are to be filed under Section 11. Sub-section (1) thereof requires the unregistered dealers to be served with a notice. It is however, not necessary to serve a notice on the registered dealers. It is incumbent upon tbe registered dealers to furnish returns. In this connection, reference may be made to Rule 20 of the Orissa Sales Tax Rules, 1947. According to Rule 20, every registered dealer within one calendar month of the expiry of each quarter of a year, shall furnish to the Assistant Sales Tax Officer or the Sales Tax Officer, as the case may be within whose jurisdiction his place or places of business are located, a return in Form IV showing particulars in respect of the sales tax payable by him. Form IV prescribes the form for return of sales tax payable by the dealer. In Clause (C) of the form the dealer has to state the gross turnover on sales which have taken place in Orissa. Then under Clause (G) he has to state the balance being the taxable turnover. Thereafter Clause (H) is important under which the dealer has to state the tax payable by him calculated to the nearest anna. After the return is filed, assessment is made under Section 12 of the Act. Under Sub-section (1), if the Collector is satisfied that the return is correct and complete, then he proceeds to make the assessment. Section 13 thereafter deals with the payment and recovery of the tax and penalty, if any. Under Sub-section (1) of Section 13, tax payable under the Act shall be paid in the manner prescribed thereunder. Sub-section (2) lays down that before any registered dealer furnishes the returns required by Sub-section (1) of Section 11, he shall in the prescribed manner, pay into a Government treasury the full amount of tax due from him under the Act according to such returns and shall furnish along with the returns, a receipt from such treasury showing the payment of such amount. We are not very much concerned with Sub-section (3), Sub-section (4) lays down that the amount of tax : (a) due where the returns are furnished without receipt, showing full payment thereof, or (b) assessed under Sub-sections (1), (2), (3) and (4) of Section 12 less the sum, if any, already paid by the dealer in respect of the said period (sic). Sub-section (5) speaks about the penalty and Sub-section (6) lays down that the amount of tax together with the penalty, if any, which remains unpaid after the date specified in the notice issued under Sub-section (4) or after the date specified in the notice under Sub-section (5) shall be recoverable as an arrear of land revenue. Thereafter comes Section 19. Sub-section (1) of Section 19 speaks about the tax payable by a transferee of a business and it states that any tax payable in respect of such business remaining unpaid at the time of the transfer shall be payable by the transferee as if he were the registered dealer within 30 days of the transfer. Sub-section (2) deals with unregistered dealers and it lays down that for the purpose of fixing liability of a transferee-unregistered dealer under Section 4 the gross turnover of the business of the transferor shall be deemed to be the gross turnover of the business of the transferee.
3. The Tribunal is right in his view, as I had stated earlier, that Section 19(1) deals with registered dealers whereas Section 19(2) deals with unregistered dealers. Reliance was placed on a case of the Patna High Court reported in In the matter of Bihar Bolts and Pivets and Engineering Works Ltd.  10 S.T.C. 578. That was a case in which the provisions of the Bihar Sales Tax Act were under consideration. It appears that the provisions of the Bihar Sales Tax Act are similar to the provisions of the Orissa Sales Tax Act. The Tribunal appears to have overlooked that portion of the judgment where the learned Judge was dealing with the difference between the Bihar Sales Tax Act and the Indian Income-tax Act. Sahai, J., in unmistakable terms had observed that there are two important points of difference between the Bihar Sales Tax Act and the Indian Income-tax Act, 1922. (1) Whereas income-tax for the assessment year is assessed on the income of the previous year, sales tax becomes liable to be paid immediately after each sale is effected though, for facility of computation and payment of tax, provision has been made for the filing of returns at the. expiry of each quarter. (2) Whereas rates of income-tax vary in accordance with the amount of income and therefore no one can be certain of what income-tax he has to pay at least until the accounting year expires, the rate of sales tax does not vary on the amount of taxable turnover and a dealer, therefore, can always be certain of what sales tax he has to pay as soon as he effects a sale. In other words, sales tax becomes payable immediately after a sale is transacted. Mr. Bhattacharjee, learned counsel on behalf of the assessee sought to rely upon a judgment of the Calcutta High Court in the case of In re Recols (India) Ltd.2 He argued that there is some difference between the amount of tax and the sum deductible after the final assessment is made. That decision came to be considered by Sahai, J., in In re Bihar Bolts and Rivets and Engineering Works Ltd.1 and the learned Judge was of opinion that in In re Recols in (India) Ltd.  4 S.T.C. 271 Chakravartti, C.J., does not seem to have interpreted the words 'due' and 'payable' separately. But Sinha, J., interpreted the two words separately. The provisions of the Bengal Finance (Sales Tax) Act, 1941, were under consideration in that case, but it appears that those provisions were somewhat similar to the provisions of the Bihar Act. Eventually, he came to the conclusion that it is, therefore, clear that to the extent of liability admitted in a return the amount of tax is payable before the dealer submits that return. Thus, there is no doubt that the tax is payable since the sale is transacted and it is incumbent upon the registered dealer to state that amount in the return when submitted. Not only that, it is also enjoined under the Act that the dealer is to deposit that amount into the Government treasury. When the assessment is made, the sum which has been deposited into the Government treasury has to be deducted from the total amount of tax. That is the reason why the expression 'the sum' has been used in Clause (b) of Sub-section (4) of Section 13 of the Act.
4. Thus, while answering question No. 1 in the affirmative, I would like to add that it must be subject to certain conditions. If the transferor-registered-dealer had filed a return and no assessment had been made, even then the transferee-dealer is liable to pay the admitted tax as in Form No. IV. If, on the other hand, no return had been filed by the registered dealer, the transferee-dealer is not liable to make payment without the transferor-dealer being assessed.
5. With regard to question No. 2 our answer must also be in the affirmative. But their also we want to make it clear that the assessment must be made under Sub-section (5) of Section 12 and not under Sub-section (4) of the same section, because Sub-section (4) clearly deals with registered dealers whereas Sub-section (5) deals with unregistered dealers.
With these observations, we accept the reference, but there would be no order for costs.
R.K. Das, J.
6. I agree.