Partner liability on dissolution permits addition as certificate-debtors and recovery without fresh assessment notices, following prescribed procedure.

Where a firm has been validly assessed and a tax debt fixed, partners who become liable on dissolution under the Partnership Act may be added as certificate-debtors and recovery may proceed against them under the Public Demands Recovery Act; outcome: partners can be made liable and subjected to execution. The authority restoring a certificate case may direct the procedure to bring partners on record as certificate-debtors without requiring fresh assessment notices, provided the certificate officer retains jurisdiction to consider objections; outcome: restoration and procedural direction to add partners is lawful and execution may proceed in the indicated manner.

---

---

Issues: (i) Whether, after a firm has been assessed and a certificate for recovery filed, the partners can be added as certificate-debtors and recovery proceeded against them where the firm is dissolved after assessment; (ii) Whether the Board of Revenue had power to restore the certificate case and direct proceedings for addition of partners as certificate-debtors and thereby permit recovery against partners without fresh assessment notices under the Income-tax Act.

Issue (i): Whether partners of a firm dissolved after assessment can be made liable and added as certificate-debtors for recovery of tax due from the firm.

Analysis: The Income-tax Act treats a firm as an assessee and fixes the debt when assessment is final and notice under section 29 is served upon the firm. For questions of liability between the firm and its partners on dissolution, the Partnership Act governs devolution of liability; section 49 provides that on dissolution partners become liable for firm debts. The Public Demands Recovery Act defines certificate-debtor to include persons whose names are substituted or added. The Income-tax Act authorises recovery by requisition and use of the recovery law (here the Bengal Public Demands Recovery Act) but does not displace general law of devolution of liability among partners.

Conclusion: The partners of a firm dissolved after assessment may be added as certificate-debtors and recovery may be proceeded against them for the debt of the firm; conclusion in favour of the revenue.

Issue (ii): Whether the Board of Revenue had power to restore the certificate case and direct the manner of proceeding to bring partners on record as certificate-debtors, without requiring fresh notices under the Income-tax Act.

Analysis: The requisition under section 46(2) permits recovery by the Collector as if the sum were land revenue; the Collector (and officers designated as such) act under the Public Demands Recovery Act as certificate officers. The appellate process before the Commissioner and the Board of Revenue permitted revival of the certificate case; the Board's operative direction was that execution against partners may proceed after they are brought on record as certificate-debtors in the manner indicated. The Board did not itself effect an immediate substantive addition but directed the procedure to bring partners on record, preserving the certificate officer's jurisdiction to consider objections. The Income-tax Act does not prohibit application of partnership law on dissolution nor bar recovery under the Public Demands Recovery Act where liability has devolved.

Conclusion: The Board of Revenue had power to restore the certificate case and to direct proceedings for addition of partners as certificate-debtors so recovery may proceed in the manner indicated; conclusion in favour of the revenue.

Final Conclusion: The objections to the certificate proceedings are overruled; the certificate case restored and execution may proceed against partners after they are properly brought on record as certificate-debtors in accordance with the applicable procedure.

Ratio Decidendi: Where a firm has been validly assessed and a debt becomes due, and the firm is subsequently dissolved, partners become liable for the firm's debt under the Indian Partnership Act and may be added as certificate-debtors and subjected to recovery under the Public Demands Recovery Act; the Income-tax Act's recovery provisions permit recourse to such recovery law without requiring fresh demands where liability has devolved on partners after dissolution.

---