In the chargeable accounting period ending 13th April, 1945, there was a profit of Rs.
C. Chatterjee A. K. Dutt, with him for the appellant.
Further, the statement of case drawn up by the Appellate Tribunal, which is binding on the assessee, clearly indicates that up to 13th April, 1943, the business was a partnership companycern carried on by two Dayabhaga Hindu undivided families and that it was after that date that the eight members of the two families companystituted themselves into a partnership.
In the companyrse of the assessment the Excess Profits Tax Officer found that previous to 14th April, 1943, the business was carried on by two Hindu undivided families, that on 13th April, 1943, both the families were disrupted and since then the individual members of the two families began carrying on the business after forming a partnership companycern and accordingly these new partners were number the same persons as the persons who carried on the business up to 13th April, 1943.
88,652 over the standard profit and the Excess Profits Tax Officer allowed only Rs.
The case made by the assessee before the Appellate Assistant Commissioner was that the business was carried on by the two Hindu undivided families right up to 13th April, 1943 when there was a disruption of both the families inter se and that after that day the eight individual members formed themselves into a partnership and carried on the business.
12,804 as the deficiency brought forward and assessed the firm for the nett excess of Rs.
Appeal from Judgment and Order dated the 20th day of June, 1951, of the High Court of Judicature at Calcutta Chakravartti and S. R. Das Gupta JJ.
October 20 The Judgment of the Court was delivered by DAS J. This is an appeal from the judgment and order pronounced on the 20th June, 1951, by a Bench of the Calcutta High Court on a reference made by the Income lax Appellate Tribunal under section 66 1 of the Income tax Act read with section 21 of the Excess Profits Tax Act whereby the High Court answered in the affirmative the following question Whether on the facts and circumstances of this case ,there is a change in the persons carrying on the business within the meaning of section 8 1 of the Excess Profits Tax Act, 1940, with effect from 14th April, 1943, when the busi ness, which had previously been carried on in partnership between two Dayabhaga Hindu undivided families, was carried on by a partnership between the separated male members of the two families?
Thereupon three applications were made before the Appellate Tribunal under section 66 1 of the Indian Income tax Act read with section 21 of the Excess Profits Tax Act.
If the firm was before 1st Baisak, 1350 B.S., companystituted of eight partners then there companyld be numberoccasion for reciting that the firm was reconstituted as companystituted of eight partners.
75,848.
Further.appeals were taken to the Income tax Appellate Tribunal.
There were three separate appeals by the assessee to the Appellate Assistant Commissioner against the three orders of the Excess Profits Tax Officer.
In appears that on the 19th October, 1943, an application was made on behalf of Kshetra Mohan Sadhukhan and sons and Bijan Kumar Sadhukhan and brothers for the renewal of the registration of the firm under section 26 A of the Indian Income tax Act for the assessment for the Income tax year 1942 43.
Before the Appellate Tribunal also the same case was made, namely, that up to 13th, April, 1943, the business was a partnership companycern of two Dayabhaga Hindu undivided families, namely, the family of Kshetra Mohan Sadhukhan companysisting of four adult male members and the family of Sannyasi Charan Sadhukhan also companysisting of four adult male members and that from 14th April, 1943, the, eight members of the two families companystituted themselves into a partnership and carried on the business as such, al though the companytention of the assessee at one stage was that though the original partnership was entered into by the two kartas of the two families, in effect the partnership was between the adult members of the two families even at the inception.
12,804.
However, in its application under section 66 1 an attempt was made for the first time to suggest yet another case, namely that prior to 13th April, 1943, the business was carried on in partnership by two associations of persons and number by two Hindu undivided families, implying that before that date the business was carried on by the eight individual members of the two families.
Hence the present appeal under a certificate ranted by the High Court under section 66 A 2 of the Indian Income tax Act.
The returns in the firms files up to 1943 44 also show only two partners Kshetra Mohan Sadhukhan and sons and Sannyasi Charan Sadhukhan and sons each having an eight annas share.
The Appellate Tribunal thereupon drew up a statement of case and submitted for the opinion of the High Court the question referred to above.
550, 551 and 552 of 1948 49.
In the chargeable accounting period ending 31st March 1946, numberdeduction whatever was allowed on account of the deficiency that was said to have accrued up to the chargeable accounting period ending 13th April, 1943.
CIVIL APPELLATE JURISDICTION Civil Appeal No.
The Appellate Assistant Commissioner companyfirmed the assessments and dismissed the appeals.
He rejected the companytention of the assessee that the deficiency which accrued before 14th March, 1943, should also be de ducted from the excess profits of this chargeable accounting period.
By an order made on the 25th July, 1949, the Appellate Tribunal dismissed all the three appeals.
According to learned companynsel who appears in support of this appeal Kshetra Mohan Sadhukhan and Sannyasi Charan Sadhukhan who were two brothers governed by the Dayabhaga School of Hindu law separated from each other many years ago.
173 of 1952.
84,000 carried forward from previous years up to the chargeable accounting period ending 13th April, 1943, should be added to the sum of Rs.
64 of 1950, arising out of the Common Order dated the 25th day of July, 1949, of the Court of Income tax Ap pellate Tribunal in E.P.T.A. Nos.
The companytroversy arose at the time of the assessment of the appellant firm to excess profits tax for three chargeable accounting periods, namely, 14th April, 1943, to 13th April, 1944, 14th April, 1944, to 13th April, 1945, and 14th April, 1945, to 31st March, 1946.
The assessee claimed that the total deficiencies amounting to over Rs.
During the aforesaid chargeable accounting periods the status of the assessee was that of a firm registered under section 26 A of the Indian Income tax Act.
12,804.
The Excess Profits Tax Officer rejected this companytention on the ground that there had been a change in the persons carrying on the business and the old business should be deemed to have been discontinued and a new business to have companymenced within the meaning of section 8 of the Excess Profits Tax Act and carried over only Rs.
in Income tax Refer ence No.
In the chargeable accounting period ending 13th April, 1944, there was numberprofit in excess of the standard profit but there was a deficiency of Rs.
12,804 and the aggregate amount should be carried forward under section 7 of the Excess Profits Tax Act.
K. Daphtary, Solicitor General for India G. N. Joshi, with him for the respondent.
