Tax recovery certificates survive firm dissolution, but personal execution against an ex-partner needs amendment and notice.

Certificates for arrears of income-tax issued against a dissolved firm remained valid, because dissolution did not extinguish the firm's assessed tax liability or render the certificates void merely for being in the firm's name. However, execution against an ex-partner personally required amendment or substitution of his name as certificate debtor and service of notice upon him in that capacity under the Public Demands Recovery Act. Until that procedural step was taken, the existing certificates could not be enforced against him personally. The result was that the certificates survived, but immediate personal execution against the respondent without amendment was not permitted.

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Issues: (i) whether certificates issued for arrears of income-tax against a dissolved firm remained valid; (ii) whether such certificates could be executed against an ex-partner personally without amendment of the certificates and notice in his own name.

Issue (i): whether certificates issued for arrears of income-tax against a dissolved firm remained valid.

Analysis: The liability for the firm's assessed tax did not cease on dissolution. A firm assessed as an assessee could still be proceeded against in the certificate proceedings in respect of tax already determined. The fact that the firm had since been dissolved did not make the certificates void merely because they were filed in the firm name after discontinuance.

Conclusion: The certificates were valid as against the firm.

Issue (ii): whether such certificates could be executed against an ex-partner personally without amendment of the certificates and notice in his own name.

Analysis: Although the tax liability of the dissolved firm could be realised from the partners, execution against an individual partner required that his name be added or substituted as certificate debtor within the meaning of the Public Demands Recovery Act, and notice had to be served upon him in that capacity. Until such amendment and notice, the existing certificates were not executable against him personally.

Conclusion: The certificates were not executable against the respondent personally unless amended and followed by notice under the Public Demands Recovery Act.

Final Conclusion: The appeal succeeded only to the extent of saving the certificates themselves, but failed insofar as immediate execution against the respondent without amendment was concerned, so the decree was modified accordingly.

Ratio Decidendi: A certificate for arrears of tax assessed against a firm survives its dissolution, but execution against an individual partner requires that he be brought on record as a certificate debtor and served with notice in that capacity.

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