SATISH CHAND L Vs. INCOME TAX OFFICER

JUDGEMENT

(1.) THESE are two connected references under Section 66 of the Indian Income-tax Act, 1922 (hereafter referred to as the Act). Satish Chand and Kishan Chand are two partners of a registered firm, Messrs. Satish Chand Kishan Chand. The Income-tax Officer Kanpur, passed two separate assessment orders against Satish Chand and Kishan Chand on their shares of income from the firm. THESE assessment orders were confirmed in appeal by the Appellate Assistant Commissioner and the Income-tax Appellate Tribunal, Allahabad. The two assessees applied to the Tribunal under Section 66 of the Act for reference to the court on the ground that a partner of a firm could not be assessed to income-tax without prior assessment of the firm itself. In each case the Tribunal has referred the following question of law to this court :

(2.) THIS question has been considered by different High Courts. In J. C. Thakkar v. Commissioner of Income-tax, [1955] 27 I.T.R. 658, it was held by the Bombay High Court that the assessment of a partner of an unregistered firm on his share of the profits in the firm is not illegal on the ground that the unregistered firm of which he is a partner has not been first assessed to tax.

(3.) IN Jyoti Prasad Agarwal v. INcome-tax Officer, B-Ward, Mathura, 1959 37 ITR 107, it was held by this court that once the income of an association was charged to income-tax in the hands of the members individually and the assessment of members remained valid, there could be no fresh assessment of the income in the hands of the association.