Dissolved firm cannot be treated as "cannot be found" where partners are known, barring successor assessment.

A dissolved firm could not be treated as a person that "cannot be found" within the proviso to section 26(2) of the Indian Income-tax Act, 1922, because a firm is statutorily identified with its partners. Where all partners were alive and their whereabouts were known, the proviso was inapplicable. The successor therefore could not be assessed on the firm's entire profits under that provision, and the assessment was not justified.

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Issues: Whether a dissolved firm can be treated as a person that "cannot be found" within the proviso to section 26(2) of the Indian Income-tax Act, 1922, so as to fasten assessment on the successor.

Analysis: The proviso applies only when the person succeeded cannot be found, which contemplates a situation where the person is dead or has disappeared. A firm is not to be dissociated from its partners for this purpose; under the statutory definition, a firm means the persons who have entered into partnership collectively. Since all the partners were alive and their whereabouts were known, the dissolved firm could not be said to be incapable of being found. The proviso therefore could not be invoked to assess the successor on the entire profits.

Conclusion: The question was answered in the negative and the assessment on the successor for the full profits was held not to be justified.

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