TMI Blog1935 (10) TMI 8X X X X Extracts X X X X X X X X Extracts X X X X ..... ial Movietone Co., for the calendar year 1931. 2. The reason for raising that question requires some explanation. 3. The assessee in a gentleman named Abubaker Abdul Rahman, and the year of assessment is the year 1932-33, that is the year ending 31st March, 1933. The assessee is a partner in two different firms, one, Abubaker Abdul Rahman Co., and the other the Imperial Movietone Co. He also has certain property which produces income, apart from his interest in the firms. The accounts of the assessee and of the firm of Abubaker Abdul Rahman Co., are made up to Diwali, that is, in the case of the previous year in respect of the year of the assessment, 9th November 1931. But the Imperial Movietone Co., makes up its accounts to 31st ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Income Tax Act. In the first place, it is necessary to notice that according to the decision of the Calcutta High Court in Behari Lal Mullick In re, the tax payable in the current year is not charged on the income of that year, but on the income of the previous year, that is to say, the tax under the Indian Act is actually levied on the income of the previous year and not as in England levied on the income of the current year though that income may be, and often is, estimated by reference to the income of the previous year, since in England the return has to be made before the current year has expired. That decision of the Calcutta High Court was apparently approved by the Privy Council in Commissioner of Income Tax v. Tehri Garhwal St ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... x is payable and under Section 3 Income Tax is charged not only on every individual but on every Hindu undivided family, company, firm and other association of individuals. So that, in my opinion a firm is clearly an assessable unit and therefore an assessee under the Income tax Act. The position which arises in this case is that the assessee has fixed for himself as the previous year the year ending 9th November 1931, whilst the Imperial Movietone Company in which the assessee is a member, has fixed as the previous year the year ending 31st December 1931. 6. The next section to look at is Section 22(2) which provides that in the case of any person other than a company, falling within the provisions of that section, a return has to b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... only be ascertained after the accounting period ending on 31st December 1931. Therefore it seems to me clear that the assessee in respect of the previous year, which applies to him, cannot be required to include his share of profits in the Imperial Movietone Company. That is not really questioned by the income tax authorities. But they contend that as soon as the share of the profits of the assessee in the Imperial Movietone Company was ascertained, then that share was liable to tax, and must be treated as having escaped assessment under Section 34. I cannot agree with that view of the matter. It seems to me that that would really involve that the assessee was accountable in respect of two previous years, one ending 9th November and the oth ..... X X X X Extracts X X X X X X X X Extracts X X X X
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