Judgment

SHAH, J. : Baba Gowd, P. V. Rajareddy and Rajareddy Mallaram formed an association of persons called "Nizamabad Liquor Shops" - called for the sake of brevity the Group . For the Fasli year 1358 i.e., October 1, 1948 to September 30, 1949 the Group carried on business in liquor contracts obtained from the former State of Hyderabad. With the end of Fasli year 1358 the contracts came to an end. The business was then discontinued, and the Group was dissolved. The Group did not make a return of its income pursuant to the general notice under S. 22(1) of the Indian Income-tax Act. The Income-tax Officer, Nizamabad Circle, issued a notice under S. 34 of the Income-tax Act calling upon Baba Gowd - one of the members of the Group - to file a return of the income of the Group, but Baba Gowd failed to file the return on the due date. The Income-tax Officer then assessed the taxable income of the Group under S. 23(4) at Rs. 51,000/-, and determined Rs. 8,826-14-0 as the tax payable. Attempts made by the Income-tax Department to recover the tax from Baba Gowd having proved unsuccessful, on March 13, 1954, the Income-tax Officer issued a notice of demand addressed to Rajareddy Mallaram