- (1.) These are two appeals with the special leave of this court, against an order dated June 1, 1956, of the High court of Judicature at Calcutta in Income-tax Reference No. 10 of 1956 and an order of the Income-tax Appellate tribunal, Calcutta bench, dated 22.03.1955, in I.T.A. No. 5037 of 1954-55 (assessment year 1948-49)The Income-tax Appellate tribunal by its order dismissed an appeal filed by the appellant firm to impugn an order of the Appellate Assistant Commissioner of Income-tax confirming an order declining to register the appellant firm under section 26A of the Indian Income-tax Act, hereinafter referred to as the Act. The order of the High court was passed rejecting summarily an application by the appellant firm under section 66(2) of the Act. The present Judgement shall dispose of both the appeals.
(2.) The facts of the case are as follows: One Bhuban Mohan Shaw, who died in 1908, had three sons, Uma Charan Shaw, a boy Charan Shaw and Panchukali Shaw. On his death, these three sons were alive, and there was also his widow, Mst. Surabala Dassi. Bhuban Mohan Shaw held an excise licence in his name for the retail sale of foreign liquor at a shop situated at No. 1, Dhararntala Street in Calcutta. After his death, the brothers formed a Hindu joint family of which Uma Charan was the karta. They were governed by the Dayabhaga law. The family continued the said business of sale of foreign liquor and the excise licences were taken in the names of Uma Charan and Panchukali. During the years that followed the business of the family was extended and other shops were opened. In addition to the retail shop of foreign liquor at Dhararntala Street, the family had an excise shop at Nos. 201 and 202, Chandney Chawk Street, Calcutta, also for retail sale of foreign liquor, an excise shop at No. 40, Moti Sil Street, Calcutta, for the wholesale of foreign liquor and an oil man stores (known as Shaw Brothers Stores) at No. 12/13, Bertram Street, Calcutta. The licences of these shops were held in different names of the members but not in the name of the Hindu joint family. The family had acquired immovable properties in Calcutta in addition to the shops.
(3.) In 1938. it is alleged, the family disrupted, and on 7.04.1939, Uma Charan and his two brothers entered into a deed of partnership which was also registered with the Registrar of Firms, Bengal. By this deed the three brothers agreed to carry on the joint family business in partnership, and they opened a separate book of account which they called Bati Khata which purported to show the capital contributions and accounts of the partners and also division of profits amongst them according to their shares. The appellant firm alleges also that even before the emergence of the partnership the brothers had begun to live in separate houses and had separated in mess, food and worship. The deed of partnership also provided that the income of the immovable property was to be collected jointly and divided equally between the three brothers. During the earlier years the joint family was assessed as a Hindu undivided family under the name of Uma Charan Shaw and Brothers, with Uma Charan Shaw as the karta in respect of the business and the immovable property.;