Law:

Section:

Section 3(1)(b) read with section 3(1)(f) of the Income-tax Act, 1961-Previous year-Previous years for partnership income and for other sources of income are different, but both relate to same assessment year-Whether income from both sources was assessable in same assessment year-Held, yes Facts For the assessment year 1962-63, the previous year of the assessee-company in respect of its various sources of income, ended on 31-7-1961. It was also a partner in a firm whose previous year ended on 31st August. The assessee-company claimed that its share of profit from the said firm, which accrued to it on 31-8-1961, i.e., after the close of its own accounting year on 31-7-1961, is assessable for the assessment year 1963-64 and not for the assessment year 1962-63. While this was negatived by the ITO, it was upheld by the AAC and the Tribunal. On reference : Held Under section 3(1 )(b), the assessee's assessment year will be 1962-63 for its accounting year ending on 31-7-1961. However, the effect of section 3(1 )(f) is statutorily to make the previous year for the assessment of the firm's income as the previous year of the partner in respect of the share income. The main part of charging section 4( 1) refers to the total income of the previous year or previous years. It, therefore, permits to tax income for different previous years in the same assessment year. In the present case, although the previous years were different in respect of both the incomes, the assessment year would be 1962-63 and not that of 1963-64 as claimed by the assessee in respect of its share from firm. Case review CIT v. M.S. Sheik Rowther [1962] 46 ITR 259 (Ker.) distinguished. Cases referred to CIT v. M.S. Sheik Rowther [1962] 46 ITR 259 (Ker.). JUDGMENT Chandurkar, J.-The assessee derived income from various sources in the previous year which commenced from 1st of August, 1960, and ended on 51st of July, 1961. The relevant assessment year for this previous year was 1962-63. The assessee was also a partner in the firm of "M/s. McKenzies Ltd. & Oriental Timber Trading Corporation P. Ltd." The previous year of :he partnership firm was 1st September, 1960, to 31st August, 1961, and in .he…

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