Assessment of a dissolved firm remains valid where notices were issued during its existence and partners stay jointly liable.

Section 44 of the Income-tax Act, 1922 preserves assessability of a dissolved firm's business income and makes the partners jointly and severally liable for the tax. Where notices under sections 22(2) and 22(4) were issued while the firm was still in existence, the assessment was not invalidated by the later dissolution. The assessment completed against the firm was therefore held valid, and liability remained enforceable against the former partners.

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Issues: Whether the assessment completed against a firm after its dissolution was valid, or whether assessment could be made only against the partners of the dissolved firm.

Analysis: Notices under sections 22(2) and 22(4) of the Income-tax Act, 1922 had been issued while the firm was still in existence. Section 44 of the Act provides that where a firm is dissolved, every person who was a partner at the time of dissolution remains jointly and severally liable to assessment for the income, profits and gains of the firm and for the tax payable. The liability therefore does not cease on dissolution, and the assessment is not invalid merely because the firm was later dissolved.

Conclusion: The assessment completed against the firm on February 24, 1955, was valid, and the answer was in favour of the Revenue.

Ratio Decidendi: Section 44 of the Income-tax Act, 1922 preserves the assessability and tax liability arising from a firm's business notwithstanding its dissolution, making the partners jointly and severally liable for assessment in respect of the firm's income.

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