JUDGMENT

1. This petition under Article 226 of the Constitution has been filed by M/s. Sidh Gopal Gajanand, described as an "alleged association of persons" and by Budhoolal Mehrotra and Sidh Gopal Kapur.

2. The petitioners say that M/s. Sidh Gopal Gajanand was a partnership firm, constituted under an instrument of partnership dated April 1, 1948, with its head office at Bombay and a brunch business at Kanpur styled as M/s. Ganga Textiles. The partnership firm is said to have consisted of 19 members, two of whom are the petitioners, Budhoolal Mehrotra and Sidh Gopal Kapur. The petitioners allege that the firm carried on wholesale cloth business from March 13, 1948, to July 1, 1949, and was dissolved on the latter date. The firm was registered u/s 26A of the Indian Income Tax Act, 1922, for the assessment year 1949-50 and was assessed to Income Tax accordingly. For the assessment year 1950-51, however, it was assessed as an unregistered firm. The firm was assessed at Bombay.

3. On February 26, 1958, a notice u/s 34 was served upon the second and third petitioners as partners of the dissolved firm stating that the income of the firm for the assessment year 1949-50 had been under assessed and that the several partners were jointly and severally liable to assessment u/s 44 of the Income Tax Act in respect of the income of the firm and called upon them to furnish a return of the income of the firm. It was also recited that the Commissioner of Income Tax, Bombay, was satisfied that the notice should be issued.

4. It appears that the Central Board of Revenue considered it desirable to transfer the case of the firm from Bombay to Kanpur and the Commissioner of Income Tax, U.P., and the Commissioner of Income Tax, Bombay, were directed to submit a report as to any objections which the firm could have against the proposal. Accordingly, the Commissioner of Income Tax, U.P., issued a notice to the members of the firm, stating that the Central Board of Revenue was of opinion that the case of the firm should be transferred from the Income Tax Officer, Bombay, to the Income Tax Officer, B-Ward, Special Circle, Kanpur, and invited objections to the proposal. The Commissioner of Income Tax, Bombay, similarly notified the members of the firm of the proposal to transfer its case to Kanpur and invited objections. On September 4, 1958, the Central Board of Revenue made an order u/s 5(7A) of the Indian Income Tax Act, 1922, transferring the case of the dissolved firm from the First Income Tax Officer, A-B Ward, Bombay, to the Income Tax Officer, B-Ward, Special Circle, Kanpur. It was stated that the transfer had been made for facility of investigation and proper assessment and the order had been passed after giving the partners of the firm an opportunity of being heard and after considering their representations objecting to the transfer.

5. After the proceedings u/s 34 in respect of the firm had been commenced, it appears that the Income Tax department came into information that another group of 18 persons, who included some of the members of the firm, had been carrying on business under the same name, M/s. Sidh Gopal Gajanand and had applied to the Chartered Bank of Australia and China, Kanpur, on July 26, 1948, for opening an account in their name. As the constitution of this entity was materially different from that of the firm the Income Tax Officer considered it reasonable to believe that this group of 18 persons was a different entity. They included the second and third petitioners. As no return had been filed by this entity and it had not been assessed to tax, the Income Tax Officer, A-B Ward, Bombay, issued a notice u/s 34 to the second petitioner calling upon him to file a return for the assessment year 1949-50. Apparently as the notice was issued to the petitioner in his individual capacity, a second notice dated January 5, 1962, was issued u/s 34 by the said Income Tax Officer to the second petitioner as member of an association of persons,