Case: Shivram Poddar Vs. Income Tax Officer, Central Circle II, Calcutta &amp; Another

er called theits head office at Calcutta carried on business in commission agency, and cotton piece goods. The firm which consisted of fourof whom was Shivram Poddar, appellant in this appealwas dissolved in February 1950 and it appears that thereupon its business was discontinued. For the assessment yearone of the partners of the firm submitted a return of its income and it was assessed on October 28, 1952, in the status of an unregistered firm.2. On March 28, 1955, theOfficer issued a notice under S. 34 read with S. 22(2) of the IndianAct, 1922 addressed to the appellant as a partner of the firm at the time of its dissolution calling upon him to submit a return of the income of the firm for the year ending March 31, 1950. The appellant moved the High Court of Judicature at Calcutta for a writ of mandamus under Art.226 of the Constitution commanding theOfficer to forbear from giving effect to the notice. The petition was dismissed by D. N. Sinha, J., and that order was confirmed in appeal under the letters Patent by the High Court of Calcutta. This appeal is against that judgment of the High Court.

Reasoning: The object of the enactment is clear : it is to authorise assessment of tax on income, profits or gains earned in a business, profession or vocation carried on by a firm or association before discontinuance of the business, profession or vocation, or before dissolution of the association, and to impose joint and several liability upon every person who was at the time of discontinuance a partner of the firm or a member of the association or at the time of dissolution a member of the association.Balmukund Radheshyam was an unregistered firm and by the discontinuance of the business it neither ceased to be liable to pay tax on the income earned by it, nor could a procedure different from the one prescribed under Ch. IV apply for the assessment of the income of that firm.11. We may observe that we have proceeded to decide this case on the footing that the business of the firm was discontinued on dissolution of the firm. It is however necessary once more to observe, as we did in C. A. Abrahams case, (1961) 2 SCR 765   : (AIR 1961 SC 609) that theAct provides a complete machinery for assessment of tax, and for relief in respect of improper or erroneous orders made by the Revenue Authorities. It is for the Revenue authorities to ascertain the facts applicable to a particular situation, and to grant appropriate relief in the matter of assessment of tax. Resort to the High Court in exercise of itsjurisdiction conferred or recognised by the Constitution in matters relating to assessment levy and collection ofmay be permitted only when questions of infringement of fundamental rights arise, or where on undisputed facts the taxing authorities are shown to have assumed jurisdiction which they do not possess. In attempting to by pass the provisions of theAct by inviting the High Court to decide questions which are primarily within the jurisdiction of the Revenue Authorities, the party approaching the Court has often to ask the Court to make assumptions of facts which remain to be investigated by the Revenue Authorities.