TMI Blog1961 (8) TMI 66X X X X Extracts X X X X X X X X Extracts X X X X ..... the assets and liabilities between the coparceners, two partnerships were started and carried on brocade business similar to the one carried on by the family. It may be stated that the partners of the two firms were members of the Hindu undivided family. The partition and the setting up of the two partnership firms was treated by the excess profits tax authorities as being hit by the provisions of section 10A of the Excess Profits Tax Act and it was held that the partial partition in respect of the brocade business and the subsequent formation of the two partnerships and the carrying on of brocade business was for the avoidance and reduction of liability to excess profits tax. This view was upheld up to the reference stage in this court. The petitioner went up in appeal to the Supreme Court and the Supreme Court reversed the decision of this court on September 23, 1953. The findings of the Supreme Court were that there was in fact a partial partition, that the brocade business of the Hindu undivided family was wound up and the assets and liabilities distributed between the members constituting the Hindu undivided family, that subsequently two partnerships were formed for car ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ... 10,239 ... 19-10-42 to 16-7-43 68,652 26,709 41,943 ... 11,175- 9-0 17- 7-43 to 8-10-43 nil 8,129 ... 8,129 11,902-11-0 9-10-43 to 26-9-44 3,138 34,800 ... 31,662 25,515-5-0 27-9-44 to 13-10-45 2,082 37,838 ... 34,756 4.673-5-0 16-10-45 to 31-3-46 1,186 16,548 ... 15,362 7,495-5-0 41,943 1,15,089 60,761-15-0 The excess profits tax paid is shown in the last column of the table. The excess profits tax authorities have allowed a refund of the last four sums of money pai ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... duty of the taxing authorities themselves to give effect to the decision of the Supreme Court and in such a situation no question of the bar of limitation under section 50 of the Income-tax Act read with section 21 of the Excess Profits Tax Act can arise. Section 66A (4) further refers to sub-sections (5) and (7) of section 66. Those provisions lay down that the Income-tax Appellate Tribunal shall pass such orders as are necessary to dispose of the case conformably to the judgment of the High Court and further under the proviso to sub-section (7) of section 66, any amount overpaid shall be liable to be refunded with such interest as the Commissioner may allow. Sri R.S. Pathak further contends that, so far as section 50 of the Income-tax Act is concerned, it lays down that no claim to refund of income-tax or super-tax under this Chapter shall be allowed unless it is made within four years from the last day of the financial year commencing next after the expiry of the previous year in which the income arose, accrued or was received or was deemed to have arisen, etc., etc. The chapter in which the section occurs is headed Refunds and begins with section 48. Sri R.S. Pathak took m ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t the business of the Hindu undivided family did continue, but in a deflated form. It must also be noticed that the persons who were the owners of the deflated business continued to be the same, namely, the Hindu undivided family. In other words, there was no change in the persons carrying on the business . It follows that the provisions of section 8 of the Excess Profits Tax Act did not apply to the case. I am supported in this view by the decision of the Madras High Court in Ramaswami Raja v. Commissioner of Excess Profits Tax [1954] 25 ITR 9 . The second paragraph of the headnote of the said report is to the following effect: Section 8(1) does not provide that if a person carrying on more than one business drops one business and continues to carry on the remaining business, the business so continued should be treated as a new business. So long as there is no change in the ownership of the business, and the business continues whether in a dwindled or expanded form, the section has no application. I respectfully agree with this decision. Sri Gopal Behari, learned counsel for the income-tax department, relied on two subsequent decisions of the Madras High Court in Govi ..... X X X X Extracts X X X X X X X X Extracts X X X X
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