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TMI Blog1960 (3) TMI 64X X X X Extracts X X X X X X X X Extracts X X X X ..... eal was that the certificates mentioned in the plaint were valid and binding upon the plaintiff and so the attachment of plaintiff's moveables which followed the execution of the certificates is valid. Some other issues of a rather technical nature were also raised in the court below at the instance of the contesting defendant. But they were not pressed on behalf of the appellant in this appeal. Upon the evidence adduced on behalf of both parties, the court below made a declaration that the certificates in question were invalid and inoperative and not binding on the plaintiff and the attachment of the properties of the plaintiff was also declared to be void. This appeal was preferred by the Union of India from the above judgment and decree passed by the trial court. The facts which have given rise to the present appeal are more or less admitted. There was a firm of the name and style of Messrs. Satyanarayan Khan-Kalicharan Sadhukban which carried on business in various kinds of oil. This was a partnership firm of which the component members were plaintiff Satyanarayan Khan, Kalicharan Sadhukhan and Bepin Behari Tat. The firm was an unregistered one. By the income-tax autho ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er placed the matter before the Certificate Officer under section 46(2) the Income-tax Art, the fact of dissolution or discontinuance of the partnership was brought to his knowledge. The Certificate Officer prepared and filed the certificates in the name of the dissolved firm. When the matter, however, came to the execution of the certificates the personal belongings of the plaintiff respondent were attached. Mr. Meyer, learned counsel for the appellant, contended before us that although for the purpose of the Income-tax Act the firm was a separate assessable unit or entity, in reality the firm had no separate or independent existence apart from its constituent members, namely, the partners. He, therefore, contended that the certificates which had been filed against the firm were capable of execution against the partners. In this connection Mr. Meyer drew our attention to a decision of the Supreme Court reported in Dulichand Laxminarayan v. Commissioner of Income-tax [1956] 29 ITR 535. He particularly drew our attention to the following two passages of the judgment occurring at pages 541 and 542 of the report. The first passage runs to the following effect : In other words, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r-these certificates were executable against the plaintiff respondent personally or individually is a matter which now requires our consideration. In the above connection Mr. Meyer argued that the partners of the dissolved firm were bound by principles of general law to pay the dues of the firm. He also drew our attention to section 44 of the Income-tax Act in this connection. That section runs in the following terms : 44. Where any business, profession or vocation carried on by a firm or association of persons has been discontinued, or where an association of persons is dissolved, every person who was at the time of such discontinuance or dissolution a partner of such firm or a member of such association shall, in respect of the income, profits and gains of the firm or association, 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. Mr. Meyer argued that this section provides for recovering income-tax from partners even after the dissolution of a firm after assessing them jointly and severally in respect of the income, profits and ga ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... been assessed for three income-tax years to which we have already referred. The firm has been dissolved. But if Dr. Gupta s contention were to succeed then income-tax for those years would be recoverable against the plaintiff respondent only after fresh assessment. We are unable to see how that can be done under the law. The real question which calls for our determination in this appeal is whether the respondent as a partner of the firm was liable for the taxes due from the firm. Mr. Meyer contended that on general principles of law the taxes are recoverable from the respondent, he having been a partner of the firm. In this connection he drew our attention to clause (b) of sub-rule (1) of rule 50 of Order XXI of the Code of Civil Procedure. That sub-rule provides for the execution of a decree against a partner which has been passed against a firm. Relying on this provision of law Mr. Meyer argued that the same principle should apply to a case of execution of a certificate under the Public Demands Recovery Act. Mr. Meyer further referred to some comments occurring at page 272 of Lindley on Partnership, eleventh edition. It has been observed there that by the common law of Englan ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... fter the addition of his name as a certificate debtor and after service of notice upon him under section 7 of the Public Demands Recovery Act. Unless and until that is done, the certificates will not be executable against the plaintiff respondent. In the result, we summarise our conclusions in the following terms : The certificates which were filed in the office of the Certificate Officer, Alipore, and which were impugned by the plaintiff as invalid and inoperative are good certificates. To that extent we reverse the decision of the trial court. We, however, hold that unless and until the certificates are amended on the lines mentioned above, and until a notice -under section 7 of the Public Demands Recovery Act is served upon the respondent in his personal capacity, the certificates cannot be executed against the respondent. To this extent we allow this appeal, and modify the judgment and decree passed by the trial court. In view of the circumstances of this case we direct that both parties will bear their own costs in this court and in the court below. Let the records be sent down to the court concerned at an early date. Kamalesh Chandra Sen, J.-I agree. - - Ta ..... X X X X Extracts X X X X X X X X Extracts X X X X
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