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Civil Reference Case No. 6 of 1956, decided on 20th March, 1957.

Income‑tax Act (XI of 1922)

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---S. 66‑Notice‑One of two partners of firm died pending reference before High Court‑No provision in partnership deed that surviving partner will carry on business of partnership‑Notice of hearing served on surviving partner-Whether good service.

Business was carried on by two partners under a deed of partnership. There was no provision in the said deed that on the death of the one or the other the surviving partner would carry on the business of the partnership. While a reference under section 66 (1) of the Income‑tax Act was pending before the High Court one of the partners died and the notice of hearing was served on the surviving partner:

Held, that as the surviving partner could not claim, according to the deed of partnership, to run the business of the partnership he could not represent the partnership which stood dissolved after the death of the other partners. As such the service of the notice of hearing on the surviving partner was not a good service.

A. F. M. Mesbahuddin with Abdul Matin Khan Chaudhury for the Commissioner.

Nemo for the Assessee.

‑This is a reference under subsection (1) of section 66 of the Income‑tax Act. The question that has been referred to this Court the instance of the Commissioner of Income‑tax, East Bengal, runs thus:

"Whether the firm which was alleged to have come into existence on the 1st July 1950 and to have been constituted by an instrument of partnership drawn up on 26th January 1952 long after the relevant accounting year is entitled to registration under section 26A of the Income‑tax Act for the purpose of assessment for the charge year 1951‑52 "

We find from the record that the reference relates to the assessee firm of the name of Messrs S. J. Lazarus & Co., Narayangunj, Dacca. It claimed registration under section 26A of the Income‑tax Act on the basis of a partnership deed, dated the 26th of January, 1952. From the partnership deed we find that there are two partners : one is Mr. Serov Joseph Lazarus and the other is his son Mr. Leon Lazarus and that there is no provision in the said deed that on the death of one or the other the surviving partner will carry on the business of the partnership under the name and style of Messrs S. J. Lazarus & Co. We are told, and it also appears from the record, that during the pendency of this reference case Mr. S. J. Lazarus died in May, 1956 leaving behind him his son, Mr. Leon Lazarus. There was some difficulty in effecting service on Messrs S. J. Lazarus & Co. When notice was sought to be served on Messrs S. J. Lazarus & Co., Narayangunj, Dacca, the respondent the notice came back with an endorsement that the company had ceased to exist. Nevertheless, the learned Advocate for the Commissioner of Income‑tax, who appears in support of this reference, on the 20th February, 1957, wanted the notice of this reference to be served on the son, he being the successor and heir of his father, Mr. S. J. Lazarus, and we passed the following order:

"Let notice be served as suggested by the Commissioner of Income‑tax at their own risk. Whether the service is good or bad, will be determined at the time of the hearing of the reference case. After the service is made as above, let the reference case come up in the list for hearing."

At the time of the hearing we pointed out to Mr. Mesbahuddin, who appears for the Commissioner of Income‑tax, that the son, who had no claim according to the partnership firm in his own name as a surviving partner, could not represent the partnership firm which stood dissolved after the death of his father, S. J. Lazarus. Mr. Mesbahuddin had no answer to this. So, we hold that the service on the respondent is not a good service. Further, the learned Advocate was candid enough to tell us that a Division Bench of this Court has in more than one case held in favour of the assessees in similar reference cases. These are, as we are told by Mr. Mesbahuddin, Reference Case No. 3 of 1956 and Reference Case No. 4 of 1956, under the Income‑tax Act, disposed of on the 2nd of January, 1957.

In the circumstances, this reference is rejected.

CHAKRABORTI, J.

‑I agree with my Lord the Chief Justice.

Reference rejected.

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