Judgment :- THANIKKACHALAM J. Under section 256(1) of the Income-tax Act, 1961, at the instance of the Department, the Tribunal referred the following question for the opinion of this court "Whether, on the facts and in the circumstances of the case, and having regard to the provisions of section 182(3) of the Income-tax Act, the Appellate Tribunal was right in holding that for the purpose of ascertaining the tax payable by the firm in respect of the share income of a non-resident partner, his share income alone should be considered and tax determined accordingly and his other income from any other source should not be included for the purpose of determining the rate of tax payable on such share income ?" * The assessee is a partnership firm. The assessee-firm filed a return of income on behalf of Sri P. R. Srinivasan, partner, admitting a total income of Rs. 29, 180. The said Srinivasan, who is a non-resident partner, besides having the share income of Rs. 29, 260 in the assessee-firm, he also had share incomes from two other firms, P. L. Rangiah Chetty SonsRs. 7, 013 and Vijaya Textiles--Rs. 9, 140. He also had individual income from other sources of Rs. 1, 450. While assessing the share income from the assessee-partnership firm amounting to Rs. 29, 260, the Income-tax Officer applied the rate of tax applicable to the total income of Rs. 46, 870, comprising not only the share income from the assessee-firm, but also the share income from the other two firms and the individual income from other sources. Aggrieved, the assessee filed an appeal before the Appellate Assistant Commissioner contending that the Income-tax Officer was not justified in including in the assessment for the purpose of calculating the rate of tax on the share income of the non-resident partner from the assessee-firm, the other incomes of the non-resident partner, such as the share income of the other two firms and his individual income. But, however, the Appellate Assistant Commissioner confirmed the order passed by the Income-tax Officer in applying the rate of tax applicable to the total income of Rs. 46, 870, Aggrieved, the assessee filed a second appeal before the Appellate Tribunal. But, however, the Appellate Assistant Commissioner confirmed the order passed by the Income-tax Officer in applying the rate of tax applicable to the total income of Rs. 46, 870, Aggrieved, the assessee filed a second appeal before the Appellate Tribunal. The Appellate Tribunal, while reversing the orders passed by the authorities below, held that while levying tax on the share income of the non-resident partner in the assessee-firm, the rate of tax applicable would be the rate which is applicable to the share income of the non-resident partner in the assessee-firm. In other words, while applying the rate for levy of tax on the share income of the non-resident partner in the assessee-firm, the rate applicable to the total income including other income if any of the non-resident partner should not be appliedLearned standing counsel appearing for the Department, submitted before us that the Tribunal was not correct in holding that the rate applicable to Rs. 29, 260 alone should be applied in the case of the nonresident, who happens to be a partner in the assessee-firm, According to learned standing counsel, the words occurring in section 182(3) of the Income-tax Act, viz., "if it were assessed on him personally" would mean if it were assessed on him personally on his total income including other sources. Learned standing counsel further submitted that the decision reported in Gnanam and Sons v. CIT would not be applicable to the facts of this case because in that case, the High Court was concerned with levy of tax payable by the assessee under section 17 of the 1922 Act. Learned standing counsel further relied upon the view expressed by the learned author of the textbook called Law of Income-tax in India, 11th edition, by V. S. Sundaram. In the abovesaid text book at page 2746, the learned author while considering the provision of section 182(3) expressed his view as under "The position now is that as before the assessment is to be made on the firm, but the rate will be the rate applicable to the non-resident, i.e., the rate applicable to his total income including other income, if any." * Learned standing counsel further brought to our notice a circular issued by the Central Board of Direct Taxes, which appears on page 278, volume 3, 11th edition of the Law of Income-tax in India by V. S. Sundaram. This circular was issued by way of clarification of the provisions contained in the 1922 Act. According to learned standing counsel, the wording of the provisions in section 23(5)(a), second proviso, is similar to the wording, contained in section 182(3), second proviso in the 1961 Act. For these reasons, it was submitted that the rate applicable for taxing a sum of Rs. 29, 260 in the present case is the rate applicable to the total income of Rs. 46, 870On the other hand, learned counsel appearing for the assessee, while supporting the order passed by the Tribunal, submitted that nowhere in the provisions contained in section 182(3) is it stated that the rate of tax applicable in the case of a non-resident partner would be the rate that is applicable for the non-resident partner with regard to his total income derived from various other sources. According to learned counsel, the wording occurring in section 182(3) would mean that on the share income of a non-resident partner, the rate of tax applicable is the rate, which is applicable on the share income of the non-resident partner with regard to the share income he derived from the assessee-firm. Learned counsel further submitted that the decision reported in Gnanam and Sons v. CIT was affirmed by the Supreme Court in Rm. Ramanathan Chettiar v. CIT. Learned counsel further pointed out that the decision reported in Gnanam and Sons v. CIT would apply on all fours to the facts arising in this case and even according to that decision of this court, the rate of tax applicable on the share income derived by a non-resident partner would be the rate applicable to the total share income derived by the non-resident partner in the firm and not the rate which is applicable to the total income of the non-resident partner, apart from what he was deriving by way of share income from the partnership firm. Learned counsel further pointed out that the Board's circular issued which is against the assessee relates to the 1922 Act, and, therefore, no consideration need be given to the Board's circular. Therefore, according to learned counsel, on a plain reading of section 182(3) the rate of tax applicable to the share income of a nonresident partner in the assessee-firm would be the rate applicable to the total income of the non-resident partner from the assessee-firm. Therefore, according to learned counsel, on a plain reading of section 182(3) the rate of tax applicable to the share income of a nonresident partner in the assessee-firm would be the rate applicable to the total income of the non-resident partner from the assessee-firm. Learned counsel also submitted that nowhere in section 182(3), it is stated that the rate should be applicable as if it were assessed on the non-resident partner personally on his total income including other income, if any. According to learned counsel, in the absence of the words "total income" in the abovesaid provision, the rate applicable to the income of the non-resident partner from the assessee-firm would be the rate applicable to the total share income from the firmWe have heard the rival submissions. The fact remains that one P. R. Srinivasan is a partner in the assessee-firm. His share income from the assessee-firm came to Rs. 29, 260. He was also a partner in the other two firms called P. L. Rangiah Chetty Sons, and Vijaya Textiles. He derived share income from the abovesaid two firms to the extent of Rs. 7, 013 and Rs. 9, 140, respectively. The said P. R. Srinivasan, is also having individual income from other sources amounting to Rs. 1, 450. The point for consideration is what is the rate of tax applicable while levying tax on the share income of Rs. 29, 260. Whether the rate of tax applicable to Rs. 29, 260 should be applied or the rate of tax applicable to the total income of Rs. 46, 870 should be applied. Section 182(3) of the Income-tax Act, 1961, runs as under "When any of the partners of a registered firm is a non-resident, the tax on his share in the income of the firm shall be assessed on the firm at the rate or rates which would be applicable if it were assessed on him personally, and the tax so assessed shall be paid by the firm." * It means that the tax payable by a non-resident partner on the share income would be charged in the hands of the partnership firm. Section 182 contemplates in the first place assessment of the total income of the firm and the tax payable on such total income. Section 182 contemplates in the first place assessment of the total income of the firm and the tax payable on such total income. In the next place, the inclusion of the share income of each partner in his individual total income for the purpose of assessment to tax has got to be considered. Sub-section (3) contemplates that when any of the partners of a registered firm is a non-resident, the tax on his share in the income of the firm shall be assessed on the firm at the rate or rates which would be applicable as if it were assessed on him personally, and the tax so assessed shall be paid by the firm. The provisions contained in section 182(3) clearly state that levy of tax in regard to the share of non-resident partner in the hands of the assessee-firm and it also prescribes the rate or rates, which would be applicable to the said share income. The crucial words occurring in sub-section (3) of section 182 are, "if it were assessed on him personally". The sub-section does not say if it were assessed on him personally on his total income. In fact, the non-resident partner of the assessee-firm is assessed separately on the share income derived from the firm, which is payable by the firm and on his other individual income he will be having a separate individual assessment wherein he will be assessed on the income derived from various other sources. Therefore, in the case of a non-resident partner, there are two assessments ; one on the share income derived from the partnership firm and another for his individual income from other sources, apart from the share income derived from the firm. It is, no doubt, true that the tax paid by the firm on behalf of the partner can be recouped by the partnership firm out of the share income due to the partner. Therefore, by paying the tax on behalf of the partner, the firm is not at sufferanceIn Gnanam and Sons v. CIT while considering the provisions of sections 17, 23(5)(a) and the second proviso of the 1922 Act, this court held that under the second proviso to section 23(5)(a) of the Income-tax Act, which deals with the assessment of a nonresident partner's share in a registered firm, the total income of the nonresident partner does not come in for assessment at all. It is only his share of the firm's income that is made liable for assessment, and the sum so determined as payable is made payable by the firm. The proviso does not call for the determination of the total income of the non-resident partner. Section 23(5) does not render the determination of the non-resident partner's total income subject to the other provisions of the Act and the Department is entitled to consider his share in the firm's income as the total income for the purpose of levy of tax. The rate which would be applicable to him if his share were assessed on him personally is the rate that is laid down in section 17 of the Act. "This decision was affirmed by the Supreme Court in Rm. Ramanathan Chettiar v. CIT, wherein the Supreme Court held that in Gnanam and Sons' case the Madras High Court relied on the decision in Seth Badridas Daga v. CIT and repelled the argument raised on behalf of the assessee that the second proviso to section 23(5)(a) called for the determination of the total income of the non-resident partner. It was held that on the language of the proviso, there was no ground for computing the income of the non-resident partner with reference to section 4(1) of the Act and for excluding the income derived without the taxable territories by the operation of section 4(1)(c)" In the decision reported in Gnanam and Sons v. CIT it was clearly stated that the proviso does not call for the determination of the total income of the non-resident partner. It was further pointed out that it is only the share of the firm's income that is made liable for assessment and the sum so determined as payable, is made payable by the firm. It would mean that the sum payable is the tax payable by the non-resident partner on the share income and that is what is contemplated as payable by the assessee-firm. This would further mean that the rate applicable to the share income of the non-resident in the partnership-firm that would be applicable when the tax was levied under section 182(3) of the Act. Any other interpretation contrary to the abovesaid view would be out of context. This would further mean that the rate applicable to the share income of the non-resident in the partnership-firm that would be applicable when the tax was levied under section 182(3) of the Act. Any other interpretation contrary to the abovesaid view would be out of context. In so far as the circular issued by the Central Board of Direct Taxes is concerned, it relates to the 1922 Act and the Board's circular will not be binding upon this court. So also the opinion expressed by an author in the text book, will also have the same effect as stated above. The opinion expressed by the author appears to be contrary to what is stated in section 182(3) of the Act. As already pointed out, in sub-section (3) of section 182, there are no words that the rate should be applicable as if it were assessed on the non-resident partner personally on his total income. In the absence of the words "total income" in section 182(3), we are not inclined to accept the argument advanced by the learned standing counsel that the rate applicable to the non-resident partner would be the rate applicable on his total income including other income, if any. In that view of the matter, we are of the opinion that the order passed by the Tribunal is in order and accordingly we answer the question referred to this court in the affirmative and against the Department. No costs.