Law:

Section:

Section 254 of the income-tax act, 1961-Appellate tribunal-Orders of-In response to notice under section 147 for assessment years 1958-59 and 1959-60, assessee filed returns showing therein income from salary and other income claimed to be non-taxable-ITO treated him as partner of firm B and made assessments accordingly-AAC annulled ITO's order observing that principle of natural justice violated by ITO-Tribunal, although concurred with AAC's finding, did not think proper to set aside assessment and to order reassessment on remand-Whether tribunal erred in law in not annulling ITO's order-Held, on facts, yes Facts The assessee had not been assessed before the back assessment proceedings for the assessment years 1958-59 and 1959-60 (relating to the respective previous years ended 31-3-1957 and 31-3-1958) were initiated against him. In response to the notice under section 147, he filed separate returns showing (i) salary income of Rs. 1,880 for each year; and (ii) Rs. 24,999 (assessment year 1958-59) and Rs. 28,503 (assessment year 1959-60) had been shown by him, but claimed the latter amounts as non-taxable. The ITO disallowed the assessee's claim. On appeal, the AAC annulled the ITO's assessment order on the grounds (i) that the assessee was not a partner in the firm B and that he was only an employee thereof; and (ii) that, for concluding that assessee was a partner, the ITO had relied on certain evidence which had not been put to assessee, Further appeal by the revenue and assessee's cross-objections were dismissed by the Tribunal observing that since the ITO did not place his material before the assessee to enable him to meet the same and that his order being one against the principle of natural justice, the same could not be sustained. It affirmed the findings of the AAC but did not think it proper to set aside the assessment and to order reassessment on remand. On reference: Held The AAC, on the merits of the case, recorded categorical finding that assessee was never the partner in firm B and that B and D had implicated him by showing him as a partner in order to reduce their tax liability during the settlement. His finding was affirmed by the Tribunal.…

Deprecated: trim(): Passing null to parameter #1 ($string) of type string is deprecated in /home/digixyei/sldsystempk.com/view/master-layout/view_case.php on line 492