Judgment

BHAGWATI, J.:- This appeal by certificate raises a short question of law relating to the interpretation of S. 226 (3) of the Income-tax Act, 1961. The petitioners were at all material times a partnership firm carrying on business as bankers and dealers in cloth and over the years, they had dealing with a limited company called B. R. Sons Limited which at one time acted as the sole selling agent of Laxmi Ratan Cotton Mills Company Limited. There was a running account between the petitioners and B. R. Sons Limited in respect of these dealings and according to the petitioners, there was a debit balance of Rs. 76,436.23 against B. R. Sons Limited in this account as on 24th May, 1966. On 21st May, 1966 the Income-tax Officer, Central Circle, Kanpur issued a notice to the petitioners under Section 226 (3) (i) stating that a sum of Rs. 22,89,281.97 was due from B. R. Sons Limited on account of income-tax, supertax, penalty etc. and requiring the petitioners to pay to him forthwith any amount due from the petitioners to B. R. Sons Limited or held by the petitioners for or on account of B. R. Sons Limited to the extent of the aforesaid arrears of tax due from B. R. Sons Limited. The