S B AMEERUDDIN Vs. INCOME TAX OFFICER

JUDGEMENT

(1.) THESE are petitions for the issue of writs of certiorari to quash the orders of the respondent made under section 155 of the Income-tax Act, 1961"The continuing partners hereby and in consideration of the covenants and stipulations made in the indenture jointly and severally covenant with the outgoing partner to pay, discharge and fulfil all debts and obligations of the partnership and at all times hereafter effectually indemnify and keep indemnified the outgoing partner and his representative-in-interest and his estate and effects thereof from all proceedings, claims and expenses in respect thereof." *In the deed of indemnity it is provided that the continuing partners jointly and severally"hereby undertake to indemnify (the petitioner) ......... against all claims that may arise after the date of the dissolution for the period before the date of dissolution and that may be raised thereafter by the income-tax department either in relation to the income-tax assessment of the said firm or in any such assessment relating to his person during the course of his association with the said firm or any other liability of the firm affecting any period." *The petitioner also filed O. S. Nos. 87, 92 and 158 of 1963 and 18 of 1964 on the file of the Court of the Additional Subordinate Judge, Vellore, against the four continuing partners for specific performance of the provisions of the deed of indemnity and claimed to be indemnified against any liability under the proceedings initiated under section 147. The reassessment orders were not made by then.

(2.) THE income-tax department was impleaded as the fifth defendant in the suits, but no relief was claimed as against the income-tax department. THE suits, it is stated, were decreed as against defendants Nos. 1 to 4 and dismissed as against the fifth defendant, the income-tax department. Relying on these documents and the decrees, the learned counsel for the petitioner contended that his assessment cannot be revised under section 155. Section 155 is not subject to any agreement between the parties, nor is the apportionment of the total income of the firm among the partners as provided in the proviso to section 187(1) made subject to any agreement between the parties. We are unable to see how the terms of the deed of indemnity could be invoked at all as against the income-tax authority. THE liability of the petitioner is a statutory liability and there is nothing in the statute itself which relieves the petitioner of his obligations. Even in the suits filed against the partners he did not get any relief against the department. Even assuming that the petitioner could rely on the provisions of the Indian Partnership Act, 1932, it is seen from section 32(2) that his liability to the department is not discharged by the reconstitution or the deed of indemnity obtained.