Company in liquidation remains taxable, and the official liquidator must furnish the income-tax return.

A company in liquidation remains a "company" for income-tax purposes until dissolution, so commencement of winding-up does not by itself remove its tax liability. The official liquidator may be treated as the principal officer or as a statutory manager for return-filing purposes, and is therefore bound to furnish the income-tax return. The fact that some deduction provisions may not operate in every liquidation does not affect the basic obligation to file. The Companies Act does not exclude recovery against company property, and the tax net continues to apply during liquidation.

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Issues: Whether a company in liquidation remains a company for purposes of income-tax liability and whether the official liquidator is bound to furnish the income-tax return.

Analysis: The expression "company" in the Income-tax Act was held to include a company in liquidation because a company continues to exist until dissolution under the Companies Act. The official liquidators, while managing the business during winding-up, could be treated as the "principal officer" or as managers within the statutory meaning, and the inability to apply some deduction provisions in every liquidation case did not affect the basic liability to make a return. The scheme of the Act showed an intention to cast the tax net widely, and there was no basis for treating companies in liquidation as exempt merely because liquidation had commenced. The possibility of enforcing tax against company property was also not excluded by the Companies Act.

Conclusion: The official liquidator is not exempt from making the income-tax return, and the income-tax authorities may require the return to be furnished.

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