Law:

Section:

Section 222 of the Income-tax Act, 1961 [Corresponding to section 46(2) of the Indian Income-tax Act, 1922] - Collection and recovery of tax - Certificate proceedings - 'Q' and 'A' purchased certain machinery and other property from company 'S' under a sale deed - Thereafter, they entered into a partnership with some other persons and leased out aforesaid machinery and other property to said partnership - In certificate proceedings against company 'S', respondent No. 1 - Tahsildar issued notice to petitioner-partnership firm stating that petitioner had purchased company 'S' with all its liabilities and, therefore, was liable to pay income-tax arrears due from company 'S' - On writ filed by petitioner, respondents raised preliminary objections that Collector had not been impleaded as a party to instant petition; that petitioner should have filed its objections before respondent No. 1-Tahsildar and that petitioner should have filed suit in ordinary Civil Court for injunction to restrain respondents from recovering amount of income-tax from petitioner - Whether since there was no evidence that Collector himself passed any order that money should be recovered from petitioner firm or from property purchased by two partners of firm against which petitioner could be said to be aggrieved, it was not necessary for petitioner to implead Collector as party to petition - Held, yes - Whether since there is no provision of law under Act which permitted petitioner to file objections before Tahsildar, it could not be said that petitioner had any other suitable remedy which it failed to avail itself of - Held, yes - Whether since neither sale deed showed nor there was any other evidence to or show that vendees ever undertook any liability to pay creditors of company 'S', petitioner company its partners could not said to be either assessee or heirs of assessee and therefore, amount of income-tax dues from company 'S' could not be recovered from petitioner or its partners - Held, yes FACTS 'Q' and 'A' purchased certain machinery and other property from company 'S' under a sale deed. Thereafter they entered into a partnership with some other persons. The partnership took on lease…

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