Income-tax Officer while issuing certificate under section 222 in the case of firm should also mention the names of the partners of the firm. - Income Tax - 517/CBDT

INSTRUCTION NO. 517/CBDT Dated : Feburary 28, 1973 Section(s) Referred: 222 Statute: Income - Tax Act, 1961 In the case of Kethmal Parekh Vs. TRO, Vijayawada, and another (1973) 87 ITR 101 the Andhra High Court considered the question whether a notice issued under Rule 73 of the Second Schedule was devoid of jurisdiction in relation to the partner, when the Income-tax Officer had forwarded a certificate to the Tax Recovery Officer under section 222 of the Income-tax Act, 1961 mentioning only the name of the firm. Their Lordship held since he partner's name was not included in the certificate issued under section 222 he could not be proceeded against under Rule 73. According to Rule 1(b) of the Second Schedule, defaulter means the assessee mentioned in the certificate and inasmuch as the name of the partner does not appear in the certificate issued under section 222 he will not be subject to the proceedings initiated by the Tax Recovery Officer under the Second Schedule for collection of the tax arrears of the firm. 2. While allowing the petition filed by the partner the High Court also held that the Income-tax Officer may amend the certificate under section 222 which has already been issued by including the name of the individual partner as defaulter. 3. The Board have accepted the decision of the Andhra Pradesh High Court. However, it is desired that in order to facilitate the Tax Recovery Officer to proceed against the partner(s) as well, the Income-tax Officer while issuing certificate under section 222 in the case of firm should also mention the names of the partners of the firm. 4. These instructions may be brought to the notice of the officers working in your charge.