TaxTMI 
TaxTMI 
1953 (9) TMI 2
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....nsisted of three partners, Mathews, Figgies and Notley. The name of the firm was A. W. Figgies & Co., and its business was that of tea brokers. There were several changes in the constitution of the firm resulting in a change in the shares of the partners. In 1924 Mathews went out and his share was taken over by Figgies and Notley. In 1926 another partner Squire was introduced. In 1932 Figgies went out, and from 1932 to 1939 the partnership consisted only of Notley and Squire. In 1939 Hillman was brought in and the partnership consisted of these three partners. In 1943 Notley went out and the partnership business was carried on by the two partners, Squire and Hillman. In 1945 Gilbert was brought in. This arrangement continued up to 31st May,....
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....on of persons and therefore in order to get relief under Section 25(4) of the Act the partners of 1939 must be the same as the partners of 1947 when the firm was succeeded by the company. The Tribunal repelled this contention and held that the relief contemplated by Section 25(4) of the Income-tax Act was to be given to the business and not to the persons carrying on the business and that mere changes in the constitution of the firm had to be ignored. It was not disputed before the Tribunal that the business of the partnership firm of A. W. Figgies & Co., continued as tea brokers right from its inception till the time it was succeeded by the limited company. The Tribunal took the view that for purposes of income-tax the firm was to be regar....
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.... of the income, profits and gains of the period between the end of the previous year and the date of such succession, and such person may further claim that the income, profits and gains of the previous year shall be deemed to have been the income, profits and gains of the said period. Where any such claim is made, an assessment shall be made on the basis of the income, profits and gains of the said period, and, if an amount of tax has already been paid in respect of the income, profits and gains of the previous year exceeding the amount payable on the basis of such assessment, a refund shall be given of the difference." The section does not regard a mere change in the personnel of the partners as amounting to succession and disregards s....
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....arged for any year at any rate or rates tax at that rate or those rates shall be charged for that year in accordance with, and subject to the provisions of, this Act in respect of the total income of the previous year of every individual, Hindu undivided family, company and local authority and of every firm and other association of persons or the partners of the firm or the members of the association individually." The partners of the firm are distinct assessable entities, while the firm as such is a separate and distinct unit for purposes of assessment. Sections 26, 48 and 55 of the Act fully bear out this position. These provisions of the Act go to show that the technical view of the nature of a partnership, under English law or Indian....