Section 85. Liability in case of transfer of
business.-
(1) Where a taxable person, liable to pay tax under
this Act, transfers his business in whole or in part, by sale, gift, lease,
leave and license, hire or in any other manner whatsoever, the taxable person
and the person to whom the business is so transferred shall, jointly and
severally, be liable wholly or to the extent of such transfer, to pay the tax,
interest or any penalty due from the taxable person upto the time of such
transfer, whether such tax, interest or penalty has been determined before such
transfer, but has remained unpaid or is determined thereafter.
(2) Where the transferee of a business referred to in
sub-section (1) carries on such business either in his own name or in some
other name, he shall be liable to pay tax on the supply of goods or services or
both effected by him with effect from the date of such transfer and shall, if
he is a registered person under this Act, apply within the prescribed time for
amendment of his certificate of registration.
