Statutory agency for income tax is confined to one assessment year and cannot support advance-tax demands for a later year.

A statutory appointment as agent under section 43 is confined to the assessment year for which it is made, because income-tax assessment is year-specific and the agency does not automatically continue into a later year. The phrase "for all purposes" applies only to the incidents of that particular assessment, including levy and recovery for that year, and does not extend the agency to impose advance-tax liability for a subsequent assessment year. Advance tax under section 18A relates to the later year's tax liability, so a fresh and valid appointment was required for that year. In its absence, the demand notices were without jurisdiction and invalid.

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Issues: Whether an appointment of a person as a statutory agent under section 43 for one assessment year continued to authorise a demand for advance tax for a subsequent assessment year without a fresh order under section 43.

Analysis: Section 43 creates a vicarious liability only for the assessment year for which the appointment is made, and the assessment under the Act is self-contained for each year. The expression "for all purposes" in section 43 extends only to the incidents of that particular assessment, including levy and recovery of tax for that year, and does not carry the agency into a different assessment year. Advance tax under section 18A may be collected during the financial year, but it is attributable to the tax liability of the subsequent assessment year. In the absence of a fresh and valid appointment under section 43 for the relevant year, the demand for advance tax from the petitioners as agents of the non-resident firms could not be sustained.

Conclusion: The demand notices were illegal, void, and without jurisdiction, and the petitioners succeeded in challenging them.

Ratio Decidendi: A statutory agency under section 43 of the Indian Income-tax Act is confined to the specific assessment year for which it is valid, and it cannot be used to impose advance-tax liability for a subsequent year unless a fresh appointment is made for that year.

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