CHATTERJEE, J. - The Commissioner of Income-tax has caused the Income-tax Appellate Tribunal to refer the following question to this Court for its opinion :-
'Whether in the facts and circumstances of the case Mr. N. C. Mandal was entitled to relief under Section 25(3) in respect of his share of income from the firm of N. C. Mandal & Co., Solicitors, for the period March 1, 1943, to March 15, 1944.'
The facts are admitted and are as follows : Mr. N. C. Mandal who was a senior attorney of this Court had been carrying on his business or profession as an attorney. In 1925 he entered into partnership with another solicitor, Mr. K. L. Mandal, and both carried on business as attorneys of this Court under the name and style of N. C. Mandal and Co. On March 1, 1944, two new partners were taken in and the shares were redistributed. Formerly, Mr. N. C. Mandal had 12 annas share. That share was continued. Mr. K. L. Mandal had 4 annas share. That share was reduced to 2 annas. The two new partners were given one annas each. On March 16, 1944, Mr, N. C. Mandal retired from his profession. He notified the Incorporated Law Societu of his retirement, and gave notice of discontinuance of profession to the revenue authorities.
The Income-tax authorities contend that he is not entitled to relief under Section 25(3) of the Income-tax Act, the relevant portion of that section is as follows :-
'Where any business, profession or vocation on which tax was at any time charged under the provisions of the Indian Income-tax Act, 1918, is discontinued, then unless there has been a succession by virtue of which the provisions of sub-section (4) have been rendered applicable, no tax shall be payable in respect of the income. Profits and gains of the period between the end of the previous year and the date of such discontinuance....'
In our opinion it is clear that the profession or business of Mr. N. C. Mandal was discounted in the year 1944 and that he is entitled to relief under Section 25(3). The statement of case records that on appeal the Tribunal found that the respodent did not cases to be a solicitor, though he had entered into partnership. He practiced as an attorney of this Court indisputably up to 1924. From 1924, though he entered into partnership with another solicitor, it cannot possibly be said that he ceased to be an attorney of this Court, because a solicitor becomes a member of a firm of solicitors, he does not give up his profession of solicitor but really enters into a venture with other members of his profession in order to work jointly as attorneys. Qua partner of a the firm of Messrs, N. C. Mandalk & Co., Mr. Mandal did practise as a solicitor from 1924 to 1944. In fact from the records it appears that apart from the firm, Mr. N. C. Mandal sometimes did carry on his profession independently.
A firm of solicitors cannot possibly function unless all the partners are qualified solicitors on the rolls of this Court. A firm is not a juristic entity and a partnership of non-proessional gentlemen cannot possibly function as a firm of attorneys. It can only function as such provided its partners are solicitors qualified to practise as such. In the circumstances we have no doubt that the Tribunal came to the correct conclusion when it gave the benefit of Section 25(3) to the assessee. They have found that he had already paid income-tax before 1918 and as he ceased to practise from 1944 he is entitled to the relief which he has claimed.
We answer the question put to the High Court in the affirmative, and we hold that the assessee is entitled to relief under Section 25(3) in respect of his share of income from the firm of N. C. Mandal & Co., for the relevant period March 1, 1943, to March 15, 1944.
The assessee is entitled to the costs of this reference.
HARRIES, C.J. - I agree. Reference answered in the affirmative.