Summarize the following court judgment. Appeal No. 290 of 1963. Appeal from the judgment and order dated January 19	 1960	 of the Andhra Pradesh High Court in case referred No. 7 of 1958. K. N. Rajagopal Sastri and R.N. Sachthey	 for the appellant. K. Bhimasankaram and K.R. Sharma	 for the respondent. November 20	 1963. The Judgment of the Court was delivered by SHAH	 J. Baba Gowd	 P.V. Rajareddy and Rajareddy Mallaram formed an association of persons called "Nizamabad Group Liquor Shops" called for the sake of brevity 'the Group '. For the Fasli year 1358 i.e. October 1	 1948 to September 30	 1949 the Group carried on business in liquor contracts obtained from the former State of Hyderabad. With the end of Fasli year 1358 the contracts came to an end. The business was then discontinued	 and the Group was dissolved. The Group did not make a return of its income pursuant to the general notice under section 22(1)of the Indian Income tax Act. The Incometax Officer	 Nizamabad Circle	 issued a notice under section 34 of the Income tax Act calling upon Baba Gowdone of the members of the Group to file a return of the income of the Group	 but Baba Gowd failed to file the return on the due date. The Incometax Officer then assessed the taxable income of the 511 Group under section 23(4) at Rs. 51	000	 and determined Rs. 8	826 14 0 as the tax payable. Attempts made by the Income tax Department to recover the tax from Baba Gowd having proved unsuccessful	 on March 13	 1954	 the Income tax Officer issued a notice of demand addressed to Rajareddy Mallaramanother member of the Group. The latter then applied under section 27 of the Indian Income tax Act for can cellation of the assessment. The application was rejected by the Income tax Officer. In appeal to the Appellate Assistant Commissioner	 the order was set aside and the Income tax Officer was directed to cancel the order of assessment under section 23(4) and to make a fresh assessment after giving an opportunity to Rajareddy Mallaram to file a return and to produce the books of account of the dissolved Group. The Income tax Appellate Tribunal	 Hyderabad Branch modified the order of the Appellate Assistant Commissioner. The Tribunal held that a valid order of assessment under section 23(4) having already been made in the case there could be no occasion to issue a fresh notice to Rajareddy Mallaram or to make a fresh assessment	 but somewhat inconsistently with that opinion	 'the Tribunal directed that the Appellate Assistant Commissioner do consider whether Rajareddy Mallaram had been prevented by sufficient cause from making the return. At the instance of Rajareddy Mallaram the following two questions were referred to the High Court of Andhra Pradesh by the Tribunal. "(1) On the facts and in the circumstances of the case	 was the order of assessment made by the Income tax Officer under section 23(4) on 30 9 1953 bad in law? (2) If the answer to the above question is in the negative	 was not the applicant liable for the amount of tax payable as determined in that order of assessment by reason of the terms of section 44 of the Income tax Act?" The High Court answered the first question in the affirmative and held that the second question did 512 not fallto be determined. In arriving at its conclusion the HighCourt recorded the following findings: "(1)On the facts and in the circumstances of this case	 the order of assessment made by the Income tax officer under section 23 on 30 9 1953 is bad in law	 (a) absolutely	 because he Made the assess ment of the association and not of those who were members of the association at the time of the dissolution jointly and severally; and (b) particularly as against any member on whom notices under sections 34 and 22(4) were not served because of such failure to serve notices on him. The assessment is not binding on the petitioner	 as no notice under section 22 was issued to him and as he was not assessed severally or jointly with others referred to above. (ii) The applicant is not liable for the amount of tax payable as determined in the order of assessment dated 30 9 1953	 as that assessment was not made in conformity with section 44 of the Income tax Act. " The sole question which fell to be determined before the taxing authorities was whether the order of assessment made by the Income tax Officer	 subsequent to the dissolution of the Group	 assessing its income	 after serving a notice upon one and not all the members of the Group	 could be enforced against members of the Group who were not served. The material part of section 44 of the Indian. Income tax Act (insofar as it dealt with the liability of discontinued associations) before it was amended by section 11 of Finance Act XI of 1958 with effect from April 1	 1958	 stood as follows: "Where any business	 profession or vocation carried on by a association of persons has been discontinued	 or where an 513 association of persons is dissolved	 every person who was at the time of such discontinuance of dissolution a member of such association shall	 in respect of the income	 profits and gains of the . association	 be jointly and severally liable to assessment under Chapter IV and 	for ' the amount of tax payable and all the provisions of Chapter IV shall	 so far as may be	 apply to any such assessment. " The section declares the liability for assessment under Ch. IV of the Act in case of discontinuance	 of the business of or dissolution of an association. The Group admittedly discontinued its business at the end	 of Fasli year 1358 and it was also dissolved. Every person who was at the time of such discontinuance or dissolution a member of the Group was by the express terms of section 44 liable to be assessed jointly and severally in respect of	 the		 income	 profits and gains of the Group and was also liable for the amount of tax payable. This Court in examining the scheme of section 44 as it ' stood before its amendment in 1958 in its application to a firm which had discontinued its business observed: C.A. Abraham	 Uppoottil	 Kottayam Y. The Income tax Officer	 Kottayam and another "In effect	 the Legislature has enacted by section 44 that the assessment proceedings may be commenced and continued against a firm of which business is discontinued as if discontinuance has not taken place. It is .enacted manifestly with a view to ensure continuity in the application of the machinery provided for assessment and imposition of tax liability notwithstanding dis. 	continuance of the business of firms. By a fiction	 the firm is deemed to continue after discontinuance for the purpose of assessment under	 Chapter IV." In Abraham 's case (1) the Court was concerned with;the assessment of a firm of which the business was discontinued because of the ' dissolution of the (1)[1961] 2 S.C.R. 765 at p. 770. 514 firm	 by the death of one of the partners. But section 44 as it stands amended by Act	 7 of 1939 applies to 'discontinuance of the business of associations of persons as well as of firms	 and the question which directly fell to be determined in that case was whether penalty for concealing the particulars of income or for deliberately furnishing inaccurate particulars of income in the return could lawfully be imposed after discontinuance of the business. It is true that the validity of the order assessing the firm was not expressly challenged	 though at the date of the order of assessment the firm stood dissolved	 and its business was discontinued	 but the 'Court could not adjudicate upon the validity of the order imposing penalty without deciding whether there was a valid assessment	 for an order imposing penalty postulates a valid assessment. Counsel for the respondent contended that even if the assessment after dissolution of the Group be regarded as valid	 it is binding upon only those persons who were served with the notice calling for a return	 and in support of this plea. relied upon the clause "every person who was at the time of such dissolution	 a member of such association shall in respect of the income of the association be jointly and severally liable to assessment". He urged that the expression "every person" in section 44 means all persons	 and that by enacting that such persons shall be liable to assessment "jointly and severally" it was intended that after the association is dissolved only the members at the date of dissolution can be assessed in	 respect of the income of the association. As: a	 corollary to the argument it was submitted that all members who are sought to be assessed must be individually served with notice of assessment	 and those not	 served will not be bound by the assessment. The argument is plainly inconsistent with what	 was observed by this Court in Abraham 's case(". If	 by section	 44 the continuity of the. firm or association 	is for the purpose of assessment ensured	 (1) at P. 770. 515 no question of assessing the individual members of the association can arise. Under Ch. IV of the Income tax Act an association of persons may be assessed as a: unit of assessment	 or the individual members may be assessed separately in respect of their respective shares of the income	 but the Act contains no machinery for assessing the income received by an association	 in the hands of its members collectively. The unit of assessment in respect of the income earned by the. association is either the association or each individual member in respect of his share in the income. This is so when the association is existing	 and after it is dissolved as well. There can be no partial assessment of the income of an association	 limited to the share of the member who is served with notice of assessment. For the purpose of assessment the Income tax Act invests an association with a personality apart from the members constituting if	 and if that personality is for the purposes of Ch. IV	 insofar as it relates to assessment	 continued	 the theory of assessment binding only upon members who were served with the notice of assessment can have no validity. This view is supported by the use of the expression "tax payable" in section 44 which in the context in which it occurs can only mean tax which the association but for dissolution	 or discontinuance of its business would have been assessed to pay. Since the primary purpose of section 44 is to bring to tax the income of the association after it is dissolved or its business is discontinued	 assessment of an aliquot share of that income is not contemplated by section 44 of the Income tax Act. The effect of section 44 is as we have stated	 merely to ensure continuity in the application of the machinery provided in Ch. IV of the Act for assessment and for imposition of tax liability notwithstanding discontinuance of the business of the association or its dissolution. By virtue of section 44 the personality of the association is continued for the purpose of assessment and Ch. IV applies thereto. What can be assessed is the income of the association received prior to its dissolution and the members of the association would be 516 jointly and severally assessed thereto in their capacity as members of the association. For the purpose of such assessment	 the procedure is that 'applicable for assessment of the income of the association as if it had continued. A notice to the appropriate person under section 63(2) would	 therefore	 be sufficient to enable the authority to assess to tax the association. The plea 'that the respondent not having been served personally with the	 notice of assessment is not liable to pay the tax	 assessed cannot therefore be sustained. Counsel for the respondent then contended that the original assessment made under section 23(4) was invalid	 because notice of assessment was not served upon the Group in the manner provided by section 63(2) of the lndian Income tax Act	 Baba Gowd who was served with ' the notice not being the principal officer who .could be served	 with notice on behalf of the Group. But no such contention was raised before the Tribunal. It does not arise out of the order of the Tribunal and the question referred by the Tribunal to the High Court does not. justify consideration of that plea. The respondent . 'cannot be permitted to raise a question which did not arise out of the order of the Tribunal	 and has not been referred. The case must be decided on the footing that notice of assessment was properly served on Baba Gowd and that the assessment	 was properly 	 made by the Income tax Officer tinder section 23(4). We hold that the answer to the first question will be in the negative. If the order of assessment is held to be valid	 the application made by the respondent for setting aside the assessment on the ground that he was not served with the notice of assessment must fail. 	 The second question will be answered as follows "The applicant was liable 'for the amount of tax payable under the order of assessment. " The appeal is allowed. The respondent will pay the costs of this appeal in this Court and in the High Court. Appeal allowed.

An association of three persons carrying on business in liquor was dissolved. No return was filed on behalf of the association or the individual members. The Income tax Officer issued a notice under section 34 of the Income tax Act calling upon Baba Gowd	 one of the members of the association	 to file a return of the income of the association but he did not so. The Income tax Officer then assessed the taxable income of the association under section 23(4) of the Act and determined the tax payable. Attempts to recover tax from Baba Gowd were not successful. The Income tax Officer then issued a notice of demand to the respondent	 another member of the dissolved association. The respondent applied under section 27 for cancellation of the assessment. The application was rejected by Income tax Officer. The Appellate Assistant Commissioner ordered cancellation of the assessment and directed that fresh assessment be made after giving an opportunity to the respondent to file a return and to produce evidence in support thereof. The Income tax Appellate Tribunal held that a valid order of assessment had already been made and there was no occasion to issue a fresh notice to the respondent or to make a fresh assessment. At the instance of the respondent	 the Tribunal referred to the High Court two questions whether the order of assessment made by the Income tax Officer under section 23(4) on September 30	 1953 was bad in law or not and whether the respondent was or was not liable for the amount of tax payable as determined in that order of assessment by reason of the terms of section 44 of the Incometax Act. The High Court held that the order of assessment under section 23 (4) was bad in law and the respondent was not liable. In appeal to this Court. Held:The order of assessment made by the lncome tax Officer under section 23(4) on September 30	 1953 was not bad in law and the respondent was liable for the amount of tax payable under the order of assessment. Under Chapter IV of the Income tax Act	 an association of persons can be assessed as a unit of assessment or the individual members can be assessed separately in respect of their respective shares of income. The Act does not contain any machinery for assessing the income received by an association	 in the hands of its members collectively. The unit of assessment in respect of the income earned by the association is either the association or each individual member in respect of his share in the income. This is so when the association is existing and the same is true after its dissolution. There can be no partial assessment of the income of an association	 limited to the share of the member who is served with notice of assessment. The theory of assessment binding only those members who were served with the notice of assessment	 is not valid. The use of the expression "tax payable" in section 44 in the context in which it occurs can only mean tax which the association but for its dissolution or discontinuance of its business	 would have been assessed to pay. 510 By virtue of section 44	 the personality of the association is continued for the purposes of assessment. What can be assessed is the income of the association recieved prior to its dissolution and the members of the association would be jointly and severally assessed thereto in their capacity as members of association. For the purpose of such assessment	 the procedure is that applicable for the assessment of the income of association as if it had continued. A notice to the appropriate person under section 63(2) would	 therefore	 be sufficient to enable the authority to assess to tax the association. The plea that the respondent was not served personally with the notice of assessment and was therefore not liable to pay the tax assessed	 cannot be sustained. C.A. Abraham	 Uppoottil	 Kottayam vs Income tax Officer	 Kottayam	 ; 	 referred to.