1947 (9) TMI 10

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....November, 1920, under a partnership deed, his partners being his three brothers Karmali, Ratansi and Saleh Mohammad and his so Alidina Kassam. In 1921 the share of Alidina was increased, and Hassan Kassam, another son of the deceased, was admitted into the partnership. Ratansi died in 1922, but the business was continued by the remaining partners. In the next year Alidina restired from the business. In 1926 Karmali and Saleh Mohammad also retired and Hassan Kassam also ceased to be a partner with the result that in and from that year Kassam Manji became the sole proprietor of the business. On these facts it has been found that the partnership was dissolved in 1926. On the 30th of October, 1940, by way of a family settlement, the deceased Ka....

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....ng that Kassam Manji had been carrying on the same business at Cuttack, Calcutta and Neulput which was being earried on by the joint family and which was assessed under the Income-tax Act, 1918, and a little later at page 8 that it was difficult to get away from the fact that the same business which was taxed under the old Act, 1918, was in existence for the purpose of Section 25(4). But he added, "the records however are not clear whether Calcutta and Tangi businesses were taxed prior to 1922-23." The Appellate Tribunal in their order passed under Section 33(4) unfortunately did not decide whether the partnership, evidenced by the document of October 1940, was genuine or not, nor did they decided whether the business which is no....

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....th of October, 1940, is a genuine document and evidences real partnership; (2) that the business which is now sought to be assessed was, in fact, charged under the provisions of the Income-tax Act VII of 1918; and (3) that the business which is not sought is identical with the business which was carried on by deceased Kassam Manji in 1926. In my opinion on these findings it follows that the terms of Section 25 (4) of the Indian Income Tax Act inserted by section 30 of Act VII of 1939 apply to the assessment under consideration. The learned standing counsel, however, contended that the finding of facts submitted by the Appellate Tribunal lead to the inference in law that there has not been a complete succession to the business which was be....

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.... is not uncommon to find that capital is introduced from time to time by the owners. This does not necessarily imply that the identity of the business is changed. It is important to note at this stage that in connection with the assessment year 1943-44 the legal representatives of Kassam Manji claimed certain loss sustained by the assessee by reasons of the fact that the outstanding which had been taken over could not be recovered and the debts had become bad. The claim was disallowed and the reasons given by the Income-tax Officer were, to use his own words, as follows : Assessee was, at one time, the sole owner of the business at Chaklia Gunj, College Bazar, Neulpur and Calcutta. On 9th December, 1940, he transferred all the businesses as....