9911796707
TMI Blog1980 (4) TMI 17X X X X Extracts X X X X X X X X Extracts X X X X ..... t is alleged, received a notice under s. 281 of the I.T. Act, 1961 (hereinafter referred to as " the Act ") from the ITO, District 1(4), Chandigarh, respondent No. 2, to show cause as to why the gift of the property in question be not treated as void and why the rent of the property be not attached to realize the tax demand outstanding against her. She filed a reply to the notice. The said respondent, it is next alleged, without applying his mind to the facts passed an order on August 30, 1978, holding the gift deed to be void. She challenged the order in this court in a writ petition (C.W.P. No. 3784/78) which was accepted by the Division Bench on September 29, 1978, and it was ordered that the matter be decided afresh after taking into co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of Rs. 1,17,000. It is contended by the learned counsel for the petitioner that the ITO while declaring the gift void took into consideration a letter dated April 12, 1971, to which she was not a party. The letter was written by the ITO, Collection Ward, Chandigarh to the TRO, Patiala. He further submits that the petitioner cannot be held liable, on the basis of that letter, for the shares of the other partners. He has then argued that when the gift was made no tax was due from her and she could not foresee that the firm would be treated as an unregistered firm by the ITO for the assessment year 1969-70, while it was being treated as a registered firm in the earlier assessment years. According to him, in the aforesaid situation, the gift ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 182 of the Act deals with the assessment of registered firms. Sub-section (4) of s. 182 provides that a registered firm may retain out of the share of each partner in the income of the firm a sum not exceeding thirty per cent. thereof until such time as the tax which may be levied on the partner in respect of that share is paid by him; and where the tax so levied cannot be recovered from the partner, whether wholly or in part, the firm shall be liable to pay the tax, to the extent of the amount retained or could have been so retained. It is clear from the section that it was the duty of the firm to retain thirty per cent. of the income for the payment of the tax of the partners and in case it failed to do so, the firm was liable to pay the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Act. It is said in sub-s. (3) of that section that every person who was at the time of dissolution of a firm, a partner, shall be jointly and severally liable for the amount of the tax. From the aforesaid provisions it is evident that the liability of the petitioner was joint with the other partners. She was unable to show that her liability was being fixed at more than that which could be fixed in view of s. 182 or s. 183 of the Act. It is also relevant to point out that the petitioner has admitted that by the gift, a provision has been made for the donees after her death and during her lifetime she was entitled to the income of the property. On August 22, 1978, the statement of Hans Raj, husband of the petitioner, was recorded by th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 40 STC 207; AIR 1976 SC 656, wherein it was held that so long as tax had not been assessed and quantified, it could not be said that any specific debt due to the Revenue had come into existence and there fore, the question of a non-existent debt being a first charge on a transferred property of the assessee did not arise. Suffice it to say that that case was under the Andhra Pradesh General Sales Tax Act and the facts thereof are distinguishable. The above observations, therefore, will not apply to the present case. The learned counsel for the petitioner has next argued that the ITO had accepted the gift-tax return and made an assessment of the gift-tax which was payable by the petitioner. He further submits that if gift-tax had been paid ..... X X X X Extracts X X X X X X X X Extracts X X X X
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