INCOME TAX OFFICER GORAKHPUR Vs. RAM PRASAD

JUDGEMENT

(1.) THESE two special appeals arise out of proceedings under the Excess Profit Tax Act, 1940. There was a Hindu undivided family known as "Ramnath Ram Prasad." Ram Prasad was the karta of the Hindu undivided family. There was a disruption of the family some time by October 1, 1951. Under a scheme of voluntary disclosure, authorities were informed about a sum of Rs. 2,08,450 as income of the Hindu undivided family. Income-tax was assessed on that income. The authorities proceeded to assess excess profits tax on the same income. Three notices were issued under section 13(1) of the Excess Profits Tax Act on February 14, 1957. Another notice under the same Act was issued on April 18, 1958, under section 15 of the same Act, Ram Prasad and others field two writ petition challenging the validity of the various notices issued under section 13(1) and 15 of the Act. The two connected special appeals by the Income-tax Officer, Gorakhpur, are directed against these orders, dated December 8, 1961. The main point urged for the petitioners before the learned single judge was what, in view of the fact that the Hindu undivided family disrupted as long as October 1, 1951. Proceeding under the Excess Profits Tax Act could not be initiated in 1957 or 1958. This contention has been accepted by the learned single judge.

(2.) HE relied upon Commissioner of Excess Profit Tax v. Jivaraj Topur and Sons. It was held by the Madras High Court in that case that there as no provision in the Excess profit Tax Act to assess a Hindu undivided family which had become defunct. The same view was taken by a Division Bench of the Allahabad High Court in Commissioner of Income- tax v. Neekelal Jainarain. It was held by this court that the business of the Hindu undivided family on which notice under section 13 of the Excess Profits Tax Act had been served before the disruption on the Hindu undivided family could not be subjected to excess profits tax after the disruption of Hindu undivided family.

(3.) MR . Gopal Behari points out that section 44 and 63 of the Income-tax Act have been made applicable to proceeding under the Excess Profits Tax Act. Sub-section (1) of section 44 of the Income-tax Act state: