Case: The Income Tax Officer (Collection) Circle I, Bangalore Vs. A. Sattler

1. This is an appeal by certificate. It arises from the decision of the High Court of Mysore in Writ Petition No. 1873 of 1969 on its file. Therein the respondent prayed for a Writ of Mandamus or a direction in the nature of Mandamus, to the1, Bangalore, to issue to her a tax clearance certificate under Section 230(1) of the IndianAct, 1961. The respondent was the widow of one Mr. J. Sattlar, Mr. Sattlar and another person by name Mr. K. S. Gandhi were partners of a firm by name INKA CORPORATION. That firm went into liquidation and it was dissolved onIt appears that the firm was in arrears of payment of income tax in respect of assessment years3. TheOfficer after giving notice to Mr. Gandhi assessed the dissolved firm onNo notice of the assessment proceedings appears to have been given to Mr. Sattlar. Sometimes after the assessment was made, Mr. Sattar died leaving behind him his widow, the respondent in this case, and a daughter. The widow and the daughter of Mr. Sattlar inherited from him a half share in a house property in Bangalore. It appears that Mr. Sattlars daughter had already settled down in New Zealand. After the death of Mr. Sattlar, Mrs. Sattlar wanted to go and settle down along with her daughter and for that purpose she applied forclearance certificate. The certificate asked for by Mrs. Sattlar was refused by the appellant on the ground that there werearrears due from late Mr. Sattlar. The respondent moved the High Court of Mysore for the direction mentioned above. The High Court came to the conclusion that there was no valid assessment on Mr. Sattlar and consequently the respondent was not liable to pay the income assessed. Aggrieved by that order, theOfficer has come up in appeal to this court.

Reasoning: As seen earlier the assessment in question was made long after the firm was dissolved. By the time the assessments came to be made the partnership in question was no more in existence. Hence Mr. Gandhi cannot be considered as the agent of Mr. Sattlar for the purpose ofassessment. The notice served on Mr. Gandhi cannot be considered as notice served on Mr. Sattlar. The assessment was also made on afirm and that too without any notice to the interested person. Hence, in our opinion the High Court was right in its conclusion that there was no valid assessment on Mr. Sattlar. Once we come to the conclusion that the assessment made on Mr. Sattlar was not valid, it necessarily follows that Mrs. Sattlar was not liable to discharge the alleged tax liability.