B.C. Mitra, J.
1. The short question involved in this application in it a notice issued under Section 34 of the Indian Income Tax Act, 1922 (hereinafter referred to as the Act) is valid.
2. The petitioners Nos. 1 and 2 were partners of a firm known as Calcutta General Stores (petitioner No. 3). The said firm's business consisted, inter alia, in supplying stores and materials to tea gardens at Jalpaiguri, These supplies were effected from Calcutta and it is alleged that the firm did not carry on any business at Jalpaiguri. It is further alleged that the petitioner No. 3 carried on its business up to March 1960, and thereafter no business was carried on by fee petitioner No. 8 and therefore it was dissolved.
3. For the assessment years 1959-80 and 1960-61 the petitioner No. 8 filed returns under Section 22(2) of the Act at Jalpaiguri, and was duly assessed to tax, and the amount of the tax was also paid.
4. Two notices were issued under Section 34 of the Act to the partners of the petitioner No. 3, under Section 34 of the Act. By these notices the partners of the firm were called upon to file their returns of income for the years ending March 31, 1960 and March 31, 1961, as the respondent No. 1 had reason to believe that the income assessable to income-tax for the said assessment yean had been under-assessed. The said two notices did not bear any date.
5. On December 41, 1981 fee respondent No. 3 wrote a letter to me said firm whereby the respondent No. 3 informed fee petitioners that be proposed to transfer the case to the Income-tax Officer 'B' Ward. Companies District I, Calcutta. On December 23, 1961, the petitioners informed the respondent No. 3 that they had no objection to the transfer of the file to the Calcutta Office. Thereafter the petitioners received two other notices issued under Section 34 of the Act. By these notices the partners of the petitioner No. 3 were called upon to file the returns of their income for the assessment years 1959-60 and 1960-61 as there was reason to believe that income had escaped assessment. These notices were, however, duly dated and were addressed to:
'The partners of Messrs. Calcutta GeneralStores, Nutanpara, Jalpaiguri'.
The notices thereafter proceeded to state thatthe partners were required to deliver to theIncome-tax Officer within 35 days of the receipt of these notices, a return in the attachedform of the assessee's total income and totalworld Income assessable for the said year ending March 31, 1960. It is these notices whichare the subject-matter of the challenge in thispetition.
8. Mr. Debi Pal and Mr. R.L. Dutt appearing for the petitioners contended that a notice under section 34 of the Act was a condition precedent to the exercise of jurisdiction by the Income-tax Officer, and therefore if the notice was invalid the Income-tax Officer would nave no jurisdiction to proceed to reassess the income under Section 34 of the Act. It was argued that in this case the impugned notices must be held to be invalid as the notices were served on the partners of the firm, and these partners were called upon to submit returns of their income and their world income. On the basis of these notices the Income-tax Officer could not proceed to re-assess the income of the petitioner No. 3 as no notice in fact was served on the petitioner No. 3, whose income was sought to be reassessed under section 34 of the Act. In support of this contention reliance was firstly placed on a decision of the Supreme Court in Y. Narayana Chetty v. Income-tax Officer : 35ITR388(SC) In this case it was held that a notice under section 34 of the Act for the purpose of initiating reassessment proceedings was not a mere procedural requirement, and that the service of the prescribed notice on the assessee was a condition precedent to the validity of any reassessment made under Section 34. It was further held that if no notice was issued, or if the notice issued was shown to be invalid then the proceedings taken by the Income-tax Officer without a notice or in pursuance of an invalid notice would be illegal and void. Belying upon this decision it was argued that in this case the notice was illegal and void as the firm's income was sought to be assessed on the basis of a notice served on the partners of the firm. Reliance was next placed by Mr. Pal on a Bench decision of this Court in R. N. Bose v. Manindralal Goswami, : 33ITR435(Cal) . In that case a notice under section 34 was served on a partner described as: 'A, partner of Dyes and Chemical Agency.' It was held that the notice under Section 34 as issued on A and B could not form the basil of a valid assessment of the firm or the firm's income and A and B could not be proceeded against for recovery of the tax due under that assessment.
7. The next case relied upon by Mr. Pal was a decision of the Gujrat High Court reported in : 55ITR1(Guj) . In that case it was held that when a firm was assessed as an unregistered firm in the original assessment proceedings, the notice under Section 34(1)(a) must be issued against the firm, and a notice issued against an individual partner, or partners could not form the foundation for initiating proceedings for reassessment of the income, profits and gains. In that case the notice was issued to: 'Sri Kesrimal Bhunch, partner of M/s Dhrangadhra Salt Trading Company.' The notice, however, was sent to one of the partners mentioned above and not to the other partners of the firm. No return, however, was filed by the partner on whom the notice was served. The notice under section 34 (1) (a) of the Act was followed by a notice under Section 22 (4) of the Act which was addressed to; 'M/s. Dhrangradhra Salt Trading Company, Partner Kesrimal Bhunch, Indore.' It was held that on a construction of that particular notice as a whole it was not a notice to the firm and the proceedings under section 34, initiated on such notice, were invalid. It was, however, further held that whether a notice was on a firm or on a partner thereof had to be decided on the construction of the notice as a whole. In this case also, as in : 33ITR435(Cal) (supra) the notice was addressed by name to one of the partners who was described as partner of a firm.
8. Relying upon the decisions mentioned above Mr. Pal contended that the notice in this case was also addressed to: 'the partners of M/s Calcutta General Stores, Nutanpara, Jalpaiguri', and, therefore, the notice must be held to be invalid on the basis of the decisions mentioned above. It was argued that it appeared from the body of the notice that the partners were required to furnish a return of their total income, and total world income, but in fact what was required was the total income and total world income of the firm Calcutta General Stores. It was, therefore, argued that the notice was not a valid notice under Section 34 of the Act. Mr. S. Mukherjee, learned counsel for the respondents, on the other hand contended that the notice dated December 27, 1961, must be held to be valid notice as it was not addressed to the individual partners by name, describing them as partners of Calcutta General Stores, but it was addressed to: 'The partners of M/s. Calcutta General Stores': this made it abundantly clear and there could be no doubt, it was argued, that the partners of the firm of Calcutta General Stores were required to furnish a return of the total income and the total world income of the petitioner No. 3, of which the persons served with the notice were the partners. There could be no scope for contusion, Mr. Mukherjee argued, as the notice was net addressed to the individual partners by name as was the case in : 33ITR435(Cal) (supra) and Gujrat decision reported in Prabhudas Jagjivandas v. Income-tax Officer : 55ITR1(Guj) . It was argued that in those cases the notices were served on individual partners by name although the descriptive words 'partners of the firm' were added after their names. It was on a construction of those notices that it was held that the notice was invalid on the ground that although the total income and the total world income of the firms were called for the notices indicated that the individual partners to whom the notices were addressed were required to furnish a return of their total income and the total world income. In the instant case, however, it was argued, there could be no scope for any confusion as the notice made it plain that the persons to whom the notice was addressed were to furnish the return of the firm as the notice was addressed to the partners of Calcutta General Stores.
9. The next contention of Mr. Mukherjee was that the real question was what exactly the parties to whom the notice was addressed understood by the notice. If the petitioners Nos. 1 and 2 in this case understood by the notice that they were to furnish the return of the total income and total world income of the petitioner No. 3 and not of themselves as partners of the firm, the validity of the notice could not be challenged by the petitioners. In support of this contention reliance was placed By Mr. Mukherjee on a Bench decision of the Patna High Court reported in Commissioner of Income-tax v. Banarasilal Rajgarhia, : 51ITR659(Patna) . In that case a notice was issued under Section 34 to the assessee that income assessable to income-tax for the year ending 31st March 1948 had escaped assessment. The assessee understood the notice as relating to the assessment year 1948-49 and took time for submitting the return in answer to the notice and finally filed a return for the assessment year 19-18-49. Thereafter assessment proceedings were concluded before the Income-tax Officer, who refused to accept the assessee's contention that the income was Stridhan income of the assessee's wife. Thereafter there was an appeal to the Income-tax Appellate Tribunal, and the assessee for the first time contended that the reassessment proceedings were invalid as no notice was issued in respect of the assessment year 1948-49. On these facts it was held that as the Income-tax Officer to all intents and purposes issued a notice to reassess the assessee's income for the assessment year 1948-49 and it was so understood by the assessee, and as there was no violation of any condition precedent for the assumption of jurisdiction under Sections 34 of the Act, the clerical mistake in the notice in mentioning the year of assessment did not invalidate the notice or the assessment proceedings taken thereunder. Relying upon this decision Mr. Mukherjee contended that in this case the partners understood the notice under lection 34 of the Act to be a notice calling for a return of the total income and the total world income of the firm and that being how the notice was understood by the assessee, the validity of the notice could not be challenged because it was addressed to the partners of the firm instead of the firm itself.
10. The next contention of Mr. Mukherjee was that the statute required that in the case of a firm the notice may be addressed to any member of the firm. In support of this contention Mr. Mukherjee referred to Section 63 (2) of the Act which provides that in the case of a firm, or a Hindu undivided family, a notice may be addressed to any member of the firm or to the Manager or any adult male member of the family. It was argued that in addressing the notice to the partner of the firm, the Income-tax Officer had strictly complied with the requirements of the statute. Section 63 (2) of the Act sanctioned and directed that a notice in a case of a firm may be addressed to a partner of the firm and this is precisely what has been done in this case. It was argued that the validity of the notice cannot be called in question because the statute enjoins that the notice may be served in the case of a firm to a partner of the firm.
11. In my view Mr. Mukherjee's contentions are well founded. The notice in this case was not addressed to the partners by their names so as to give any occasion for confusion that it was the individual partners who were called upon to furnish a return of their total Income and their total world income. The notice on the other hand was addressed to: 'The partners of Messrs. Calcutta General Stores, Nutanpara, Jalpaiguri.' Therefore it was amply clear that the persons on whom the notice was served were called upon to furnish a return of the income of the firm and not the individual income of the partner. The notice, as was held by the Gujarat High Court, must be read as a whole in order to find out if the notice conveys to the assessee that a return has to be filed of the total income and of the total world income of the assessee whose income is claimed to have escaped assessment. In this case the notice was understood by the partners to be a notice calling upon them to furnish a return of the total income and the total world income of the firm of which they were partners. There was no confusion in their mind as to whose return was called for by the notice.
12. The second contention of Mr. Mukherjee that notice was served strictly in compliance with the requirements of Section 63(2) of the Act must also be upheld. Section 63(2) requires that in the case of a firm a notice may be served on a partner of the firm and this is precisely what has been done in this cage. The notice was not addressed to the partners individually in their names but it was addressed to the partners of the firm of which they are partners. This, in my view, was in compliance with the requirements of Section 63(2) and the notice dated 27-12-1961 served under Section 34 cannot be said to be invalid on the ground that it was not addressed to the firm Itself but to the partners of the firm.
13. For the reasons mentioned above,this application fails and is dismissed. The ruleis discharged. Each party to pay its own costs.