A.R. SOMNATH IYER, J. - (1.)WRIT Petition No. 304 of 1967 arises out of the recovery proceedings under the IT Act, 1961, which would be referred to as the "new Act", by which the TRO functioning under that Act took steps for the recovery of income-tax due in respect of the asst. yrs. 1954-55 and 1955-56, determined in an assessment proceeding to which an URF, of which the petitioner was a partner was a party. The URF was dissolved in the year 1955, after the assessment was made. A notice of demand under s. 29 of the IT Act, 1922, which will be referred to as the "old Act", was issued to the URF, following which, a certificate was forwarded under s. 46(2) of the old Act to the Collector. The assessee named in that certificate was the URF. In WRIT Petitions Nos. 515 to 519 and 578 and 579 the petitioner was one of the members of an AOP in respect of which there were assessments and imposition of penalties in respect of various assessment years commencing with the asst. yr. 1951-52 and ending with 1956-57. Notices of demand were issued to the AOP under s. 29 of the old Act and when there was default in payment, the ITO forwarded certificates to the Collector under s. 46(2) of the old Act in which the AOP was named as the assessee. This AOP came to an end on 14th Nov., 1956. After the new Act came into force, the TRO, functioning under the new Act, issued demand notices to the petitioners in WP No. 304/67 and the other seven petitions calling upon them to pay the arrears of tax named in the certificates forwarded to the Collector to which we have referred, and intimated them that, in the event of non-payment, their properties would be brought to sale.
(2.)WE are asked by the petitioners to quash these notices and forbid the TRO from proceeding with the recovery referred to above. It is no longer possible for the petitioners, after the pronouncement of the Supreme Court in Sahu Rajeshwar Nath vs. ITO, ((1969) 72 ITR 617 (SC) : TC52R.927, to contend that in respect of the income-tax and the penalty to which we have referred, individual notices of demand should have been issued to them under s. 29 of the old Act, in view of the enunciation made by the Supreme Court that the notice of demand issued to the URF after the assessment was made in the name of the firm, dispensed with the necessity to issue notices of demand to the individual partners of that firm. The further enunciation that the partners of the URF are not the "other person liable to pay income-tax" to whom s. 29 of the old Act refers, is equally applicable to the members of an AOP who are also not the other person liable to pay the tax of whom s. 29 of the old Act speaks. So, the elucidation made with respect to the necessity of a notice of demand under s. 29 of the old Act to the partners of an URF has equal application to the necessity of such notice of demand to a member of the AOP. The other part of the pronouncement of the Supreme Court has reference to the enforceability of the certificate under s. 46(2) of the old Act with respect to recovery of the amount payable by an URF from its individual partners. The clear pronouncement made by the Supreme Court was that, although a certificate was issued under s. 46 naming the URF as the assessee, the recovery of the amount payable by the URF from its individual partners was clearly authorised by the proviso to s. 46(2) of the old Act.
So, the pronouncement of the Supreme Court concludes the petitioners' case in respect of the two matters. The first is that the notices of demand which were issued to the URF and the AOP, respectively, under s. 29 of the old Act, were good notices making it unnecessary for the ITO to issue individual notices to the partners of the URF or the members of the AOP, as the case may be, demanding payment of the amounts due under the order of assessment made against the URF in the one case and in respect of the AOP in the other. What again emerges equally clearly from the pronouncement of the Supreme Court is that the certificates forwarded to the Collector under s. 46 (2) of the old Act naming the URF as the assessee in the one case and the AOP in the other, dispensed with the necessity of forwarding certificates naming the partners of the URF as the assessee in the one case and the AOP in the other, dispensed with the necessity of forwarding certificates naming the partners of the URF or the members of the AOP as the persons as the persons from whom recovery should be made.

So, in the case before us, when the ITO forwarded certificates under s. 46(2) in the manner in which he prepared them, it became unnecessary, if nothing else could be said about it, for the ITO to forward another set of certificates naming the partners of the URF or the members of the AOP as persons from whom the amounts specified in the certificates should be recovered.

(3.)BUT Mr. Srinivasan who did not dispute that the enunciation so made by the Supreme Court is equally applicable to the cases before us, however, maintained that, although that would be the position under the provisions of the old Act, a different situation arose in regard to recovery under the new Act, in consequence of the language of s. 222 of the new Act which is at variance with that of s. 46 of the old Act. It was said that the view which the Supreme Court expressed with respect to the permissibility of the recovery of the amount specified in the certificates prepared under s. 46 (2) which named the URF as the person from whom the recovery should be made from the partners of that firm individually, although their names were not specified in the certificates, was founded entirely on the proviso to s. 46(2) of the old Act which states that, without prejudice to any other powers of the Collector, the Collector shall have the powers which under the CPC, a civil Court could exercise in regard to the recovery of an amount due under a decree. That proviso reads : "Provided that without prejudice to any other powers of the Collector in this behalf, he shall for the purpose of recovering the said amount have the powers which under the CPC, 1908, a civil Court has for the purpose of the recovery of an amount due under a decree. Not unnaturally, Mr. Srinivasan laid considerable emphasis upon that part of the discussion by the Supreme Court in Sahu Rajeshwara Nath vs. ITO (supra) which makes it clear that the conclusion which the Supreme Court reached in that case was made to rest on the proviso to s. 46 (2) of the old Act. The relevant part of the discussion reads :
"The point taken by Mr. Kharkhanis is that it was not open to the Collector in a proceeding under s. 46(2) of the Act recover from the appellant the income-tax dues from the partnership. We are unable to accede to this argument. The proviso to s. 46(2) of the Act states that the Collector shall, without prejudice to any other powers in that behalf 'for the purpose of recovering the said amount, have the powers which under the CPC, 1908 (V of 1908), a civil Court has for the purpose of the recovery of an amount due under a decree'...

In the present case we see no reason why the Collector should not execute the certificate for demand of income-tax against the appellant who admits that he was a partner of the URF for the relevant accounting year. In the return filed by the URF on 19th Jan., 1945, at page 33 of the paper book also, the appellant is shown as one of the partners. It is manifest that the provisions of Order XXI, r. 50 (2), apply to the present case mutatis mutandis and since the appellant does not dispute that he was a partner of the URF for the relevant accounting year, the Collector could lawfully proceed to execute the certificate under s. 46(2) of the Act against the appellant and recover the income-tax arrears from him."

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