Law:

Section:

Section 2(24) of the Income-tax Act, 1961 [Corresponding to section 2(6C) of the Indian Income-tax Act, 1922] - Income - Definition of - Assessment years 1957-58 to 1962-63 - Whether words "benefit or perquisite obtained occurring in section 2(24) of 1961 Act would take in only such benefit or perquisite which company had agreed to provide and which person concerned could claim as of right based on agreement and mere advantage derived from company without its authority or knowledge will not amount to benefit or perquisite obtained - Held, yes - Whether, therefore, mere unauthorised use of company's cars by assessees, partners of firm which was managing agent of said company, could not be said to be benefit or perquisite obtained within meaning of section 2(6C)(iii) of 1922 Act or section 2(24)(iv) of 1961 Act - Held, yes Section 147 of the Income-tax Act, 1961 [Corresponding to section 34(1) of the Indian Income-tax Act, 1922] - Income escaping assessment - Illustrations - Assessees were partner in a firm which was managing agent of a company - Assessees were also shareholders as well as director of said company - Company's claim for deduction of expenses incurred on maintenance of cars was disallowed by ITO on ground that cars were partly used by managing agents of company for their private purposes - On receipt of said information, ITO who made assessment of assessees reopened assessment and treated amount disallowed as assessees' income - Whether without reopening assessments of managing agency firm, partners assessments could not be reopened - Held, yes Words and phrases : Word "obtained" as occurring in section 2(24) of the Indian Income-tax Act, 1922 FACTS A firm consisting of the assessees as partners was the managing agent of a company. The assessees were also shareholders as well as the directors of the aforesaid company. The company for the assessment years 1957-58 to 1962-63 claimed allowance for the expenses incurred by it for the maintenance of cars. The ITO who made assessment of the company disallowed portion of the company's claim on the ground that the cars were partly used by the managing agents of the company for their private purpose. This…

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