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Commissioner of Income-tax Vs. Gangadhar Gowd Rama Gowd and Co. - Court Judgment

LegalCrystal Citation
SubjectDirect Taxation
CourtAndhra Pradesh High Court
Decided On
Case NumberCase Referred No. 202 of 1979
Judge
Reported in[1986]158ITR75(AP)
ActsIncome Tax Act, 1961 - Sections 246
AppellantCommissioner of Income-tax
RespondentGangadhar Gowd Rama Gowd and Co.
Appellant AdvocateM. Suryanarayana Murthy, Adv.
Respondent AdvocateNone
Excerpt:
.....victim. the settled principles governing determination of compensation has been given a go-bye. compensation of rs.4,15,150/- awarded by the tribunal was enhanced to rs.8,20,000/-. - if that date is taken into consideration, it is admitted, the appeals were filed by ganga gowd well within the time provided under the act. the appeals filed before the appellate assistant commissioner were, therefore, well within the time and the tribunal was correct in holding that the appeals were not barred by limitation......proceedings, the tax recovery officer attached the immovable properties of another partner by name ganga gowd and also seized a sum of rs. 20,000 from his premises. at that stage, gangadhar gowd seems to have made enquiries about the reasons for attachment of properties and seizure of cash by the tax recovery officer. he was informed that the tax recovery proceedings were pursuant to the demand raised by the income-tax officer refusing the registration of the firm, orders concerning which were served on the partner gangadhar gowd. thereupon ganga gowd made an application for certified copies of the orders passed by the income-tax officer and obtained the same. after obtaining the certified copies, he filed appeals against the order refusing registration. the appellate assistant.....
Judgment:

Y.V. Anjaneyulu, J.

1. This reference arises under section 256(1) of the Income-tax Act, 1961, for the assessment years 1967-68, 1968-69 and 1969-70. The assessee is a sub-partnership firm carrying on business in excise contracts. For these assessment years, the Income-tax Officer rejected the assessee's claim for registration of the partnership firm. The connected orders were served on one of the partners by name Gangadhar Gowd. It appears, the partnership firm was dissolved and the orders in question were served on the abovementioned Gangadhar Gowd. The said Gangadhar Gowd did not take any action to appeal against the order of the Income-tax Officer refusing the registration of the firm. In course of time, the Income-tax Officer initiated proceedings for recovery of the tax due from the partnership firm and in the course of such proceedings, the Tax Recovery Officer attached the immovable properties of another partner by name Ganga Gowd and also seized a sum of Rs. 20,000 from his premises. At that stage, Gangadhar Gowd seems to have made enquiries about the reasons for attachment of properties and seizure of cash by the Tax Recovery Officer. He was informed that the tax recovery proceedings were pursuant to the demand raised by the Income-tax Officer refusing the registration of the firm, orders concerning which were served on the partner Gangadhar Gowd. Thereupon Ganga Gowd made an application for certified copies of the orders passed by the Income-tax Officer and obtained the same. After obtaining the certified copies, he filed appeals against the order refusing registration. The Appellate Assistant Commissioner admitted the appeals and allowed the assessee's claim for registration of the firm. The Income-tax Officer filed appeals against the orders of the Appellate Assistant Commissioner. The contentions taken in the appeal by the Income-tax Officer were that the Appellate Assistant Commissioner ought not to have entertained the appeals filed by Ganga Gowd as the appeals were barred by limitation if the date of service of the orders on partner Gangadhar Gowd is taken into account and that, in any event, the assessee-firm was not entitled to claim registration. The Tribunal rejected the appeals filed by the Income-tax Officer. Thereupon the Commissioner of Income-tax applied for and obtained the present reference. The Income-tax Appellate Tribunal referred the following two questions of law for the opinion of this court under section 256(1) of the Income-tax Act, 1961 :

'1. Whether, on the facts and in the circumstances of the case, the Appellate Tribunal was justified in holding that the appeals filed before the Appellate Assistant Commissioner were within time for the relevant assessment years 1967-68, 1968-69 and 1969-70

2. Whether, on the facts and in the circumstances of the case, the Appellate Tribunal was justified in holding that the assessee-firm is entitled to the benefit of registration for the assessment years 1967-68, 1968-69 and 1969-70 ?'

2. It is not in dispute that the partnership was dissolved and after such dissolution, the Income-tax Officer served the orders refusing the registration to the firm on one of the partners by name Gangadhar Gowd. Apparently, he did not take any action and when the properties of (another partner) Ganga Gowd were sought to be attached, he pleaded total unawareness of the orders passed by the Income-tax Officer and obtained copies of the orders passed and duly filed an appeal. In our opinion, for purposes of limitation it is not permissible, in the facts and circumstances of this case, to take into account the date of service of the order on Gangadhar Gowd. In the case of a partnership firm which is dissolved, wherein each one of the partners is made liable for payment of taxes on joint and several liability, it is imperative that each one of the partners is put on notice about the orders passed. In the present case, it is admitted that no orders were served on Ganga Gowd. In the circumstances, it is open to Ganga Gowd to file an appeal after obtaining certified copies from the Income-tax Officer and limitation for purposes of filing the appeal should be reckoned with reference to the date of service of certified copies of the orders on Ganga Gowd whose properties are sought to be attached. If that date is taken into consideration, it is admitted, the appeals were filed by Ganga Gowd well within the time provided under the Act. The appeals filed before the Appellate Assistant Commissioner were, therefore, well within the time and the Tribunal was correct in holding that the appeals were not barred by limitation. We accordingly answer the first question referred to us in the affirmative, that is to say, in favour of the assessee and against the Revenue.

3. As regards the second question of law whether registration can be granted to a sub-partnership, the learned standing counsel for the Revenue fairly conceded that this question has since been concluded by a decision of this court in Addl. CIT v. D. Gangareddy G. Ramkishan & Co. : [1978]111ITR93(AP) . Having regard to the above decision, we hold that the Tribunal was justified in grating the benefit of registration to the assessee-firm for the assessment years 1967-68, 1968-69 and 1969-70. We accordingly answer the second question also in the affirmative, that is to say, in favour of the assessee and against the Revenue.

4. Reference answered accordingly. The parties shall bear their respective costs. Advocate's fee Rs. 300.


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