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Issues Involved:
1. Whether the assessee's share of income from a firm managed by court-appointed receivers can be added to the assessee's personal income for tax computation under section 16(1)(a) of the Indian Income-tax Act, 1922. 2. Whether the order under section 33A(2) is administrative or judicial, and if a writ of certiorari is maintainable. 3. Whether the principles of natural justice were violated by the Commissioner of Income-tax in rejecting the review application without a hearing. Detailed Analysis: Issue 1: Assessee's Share of Income from Firm Managed by Receivers The primary question was whether the assessee's 1/3rd share of income from the firm "Sen Brothers and Company," managed by court-appointed receivers, could be added to his personal income for tax computation under section 16(1)(a) of the Indian Income-tax Act, 1922. The income had been assessed in the hands of the receivers as an association of persons. - The Income-tax Officer had added the assessee's share of the firm's income to his personal income for determining the tax rate, despite this income being exempt under section 14(2). - The Appellate Assistant Commissioner and the Commissioner of Income-tax upheld this addition, reasoning that the receivers were carrying on the business on behalf of the assessee and his co-sharers. The real assessees were the appellant and his co-sharers, and their share was liable to be added to their personal income for tax computation. - The court concurred with this view, citing Supreme Court decisions (e.g., N. V. Shammugham & Co. v. Commissioner of Income-tax [1971] 81 ITR 310 (SC)) that the real owners were the assessees, even if the receivers were the notional assessees. Thus, the income from the business was rightly added to the personal income of the co-sharers under section 16(1)(a). Issue 2: Nature of Order under Section 33A(2) The second issue was whether the order under section 33A(2) of the Act was administrative or judicial and whether a writ of certiorari was maintainable. - The court overruled the trial judge's view that the order under section 33A(2) was administrative and not subject to the principles of natural justice. The Supreme Court in Dwarka Nath v. Income-tax Officer [1965] 57 ITR 349 (SC) had established that the jurisdiction under section 33A(2) was judicial, requiring the application of natural justice principles. - Therefore, a writ of certiorari to quash such an order was maintainable. Issue 3: Violation of Principles of Natural Justice The third issue was whether the Commissioner of Income-tax violated the principles of natural justice by rejecting the review application without hearing the appellant. - Although the Commissioner did not provide an opportunity for a hearing, the court found this issue of little importance. The substantive legal question had been fully argued in court, and the court agreed with the trial judge that the assessee's share in the business income could be added to his personal income under section 16(1)(a). - The court concluded that sending the review application back for reconsideration was unnecessary, as the appellant's claim was not sustainable in law. Conclusion: The appeal was dismissed, affirming that the assessee's share of income from the firm managed by receivers could be added to his personal income for tax computation under section 16(1)(a). The court also held that the order under section 33A(2) was judicial, making a writ of certiorari maintainable. However, given the legal merits, the court found no need to address the procedural lapse of not providing a hearing. The respondents were directed to adjust any amounts already paid by the assessee towards his tax liability.
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