9911796707
TMI Blog1964 (1) TMI 58X X X X Extracts X X X X X X X X Extracts X X X X ..... rtners of the firm: Rs. As. Ps. 1. Butto Kristo Roy 0 2 8 2. Suniti Bala Devi 0 1 4 3. D.N. Chandra and others 0 4 0 4. Purnendu Narayan and others 0 1 0 5. Krishna Prasad Chatterjee and others 0 3 0 6. Kunj Behari Chandra 0 1 4 7. Lokenath Chandra 0 1 4 8. Mahadeva Chandra 0 1 4 For the assessment year 1948-49 the Income-tax Officer started penalty proceedings under section 28 of the Income-tax Act and ultimately levied a penalty under section 28(1)(c) of the Income-tax Act upon the partnership firm. The order imposing penalty is dated the 30th July, 1954. Before the Appellate Tribunal the contention of the assessee was that at the time the order of penalty was made the original partnership firm ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... submitted the following question of law for the determination of the High Court: "Whether on the facts and in the circumstances of the case the imposition of penalty under section 28(1)(c) of the Indian Income-tax Act upon the petitioner firm as constituted at the time of the levy of penalty was legal and valid?" When the case came before us in the first instance we found that it was not possible for us to furnish an answer to the question of law referred to us by the Income-tax Appellate Tribunal unless an additional statement of facts was furnished under section 66(4) of the Income-tax Act. We accordingly directed the Income-tax Appellate Tribunal to submit a supplementary statement of the case. We directed the Income-tax Appe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... firm...shall, in respect of the income, profits and gains of the firm...be jointly and severally liable to assessment under Chapter IV and for the amount of tax payable and all the provisions of Chapter IV shall, so far as may be, apply to any such assessment." The language of section 44 had been the subject-matter of interpretation by the Supreme Court in C.A. Abraham v. Income-tax Officer, Kottayam([1961] 41 I.T.R. 425 ; [1961] 2 S.C.R. 765) and in Commissioner of Income-tax v. S.V. Angidi Chettiar.([1962] 44 I.T.R. 739 (S.C.). It was held by the Supreme Court in both these cases that the expression "assessment" used in the sections of Chapter IV of the Income-tax Act is not used merely in the sense of computation of inco ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he partnership business was carried on by a new partnership constituted of Baidyanath Roy and Bijali Kanti Roy under the instrument of partnership dated the 27th August, 1952. In our opinion the argument put forward on behalf of the assessee is well founded and must be accepted as correct. Upon the facts found by the Appellate Tribunal in the present case it is manifest that the levy of penalty could be legally imposed only upon the firm which was constituted by the eight partners mentioned above for the assessment year 1947-48. In view of the provisions of section 44 of the Income-tax Act as it stood at the material time the partners of that firm would be jointly and severally liable for the payment of the penalty imposed under section 28( ..... X X X X Extracts X X X X X X X X Extracts X X X X
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