1960 PLP 917 (PTD)

2. For the assessment year 1947-48, against which the aforementioned appeal was directed, the applicant was assessed in the status of a Hindu undivided family. The appeal against that order, however, both before the Appellate Assistant Com missioner as also before this Tribunal, were preferred by one Vir Bhau who signed the memorandum of appeal in his capacity as a partner of the alleged firm and not in his capacity as the karta of the Hindu undivided family. The record shows that for the assessment years 1944-45 and 1945-46 the aforesaid Vir Bhan had himself offered to be assessed in the status of Hindu undivided family, but in the assessment for the year 1946-49, he took a plea before the Income-tax Officer that a partition of the Hindu undivided family had been effected and the business thereafter was being carried on by a firm consisting of the erstwhile coparceners of the family. The Income-tax authorities, as also this Tribunal, did not endorse the assessee's contention that the Hindu undivided family had disrupted or that the business was being carried on by a partnership firm. The assessee's application under section 25-A of the Income-tax Act was rejected. In those circumstances, the Departmental Representative took a preliminary objection that the appeal, which had been filed by the firm, was not legally maintainable.

3. The learned counsel for the appellant contended before us that the notice under section 22 (2) of the Income-tax Act was issued in the name of Gian Chand Vir Bhan as a firm and in compliance with that notice, a return was filed in the same name as a firm and no return was filed by the Hindu undivided family for the aforementioned assessment year. That being so, according to him, the assessment which had been made on the Hindu undivided family under section 23 (3) was not a proper assessment and must in fact be considered to be an assessment made on the firm and consequently the appeal filed before the Appellate Assistant Commissioner as also the one made to this Tribunal by the firm against that assessment, should be considered to be in order. The Tribunal did not accept the contention and upheld the preliminary objection. The order of the Tribunal is annexure "A" and forms part of the case.

4. The following question of law, in our opinion, arises from the aforesaid order of the Tribunal: " Whether, on the facts and in the circumstances of the case, the appeal filed by M/s. Gian Chand Vir Bhan in the capacity of a firm was a valid appeal in law and entertainable by the Tribunal ? "

5. Parties to whom a draft of this statement of the case was sent have offered no comments on it. C. L. Aggarwal for the Assessment. S. M. Sikri, (Advocate-General) with H. R. Mahajan for the Commissioner. TEK CHAND, J.-This case arises out of a reference under section 66 (1) of the Indian Income-tax Act. The fact as stated by the Income-tax Appellate Tribunal are that for the assessment year 1947-48, the applicant received notice under section 22 (2) as a firm. The Income-tax Officer assessed the applicant in the status of a Hindu undivided family. The applicant on appeal to the Appellate Assistant Commissioner was treated as a Hindu undivided family. Against the order of the Appellate Assistant Commissioner, an appeal was preferred to the Income-tax Appel late Tribunal by Vir Bhan who signed the memorandum of appeal in his capacity as a partner of the firm and not in his capacity as the karta of the Hindu undivided family. In the previous assessment years 1944-45 and 1945-46, Vir Bhan had offered himself to be assessed in the status of Hindu undivided family but in the assess ment year 1946-47 a plea was taken before the Income-tax Officer that a partition of the Hindu undivided family had been effected and the business was being carried on by a firm consisting of the erstwhile co-parceners of the Hindu undivided family. This contention of the assessee was not accepted by the Income-tax authorities and his application under section 25-A of the income tax Act was also rejected. In this appeal before the Income-tax Appellate Tribunal it has been held that the appeal was not competent simply because Vir Bhan had styled himself as a member of the firm when he should have styled himself as karta of the Hindu undivided family. The decision of the Tribunal does not appear to be correct and the applicant ought not to have been deprived of a hearing simply because he had described himself as a member of the partnership firm. In either case, whether as representative of the Hindu undivided family or as representative of the firm, Vir Bhan was competent to agitate the point before the Income-tax Appellate Tribunal. As the memorandum of appeal is signed by Vir Bhan who was competent to sign the memorandum of appeal in either capacity, the Tribunal was not justified in throwing out his appeal in limine. The Income-tax Officer when serving notice under section 22 (2) described the assessee as a partnership firm. The contention which Vir Bhan desires to raise before the Tribunal, among others, is that his firm should have been taxed not as Hindu undivided family but as an ordinary partnership firm. At the worst, signing his name and describing himself as a member of a firm can be deemed as a misdescription and for such a mis description the right of appeal cannot be taken away. The question of law, whether on the facts and in the circumstances of the case, the appeal filed by the Messrs Gian Chand Vir Bhan in the capacity of a firm was a valid appeal in law and entertainable by the Tribunal, has, therefore, to be answered in the affirmative. The assessee will be entitled to Rs. 100 as costs. KHOSLA, C. J.-I agree. Question answered in the affirmative.