Law:

Section:

Section 28(i), read with section 56 of the Income-tax Act, 1961 - Business income - Chargeable as - Assessment year 1967-68 - By agreement, assessee appointed a managing contractor for extraction of coal and received certain commission - ITO held that assessee by giving managing contractor complete control over mines of colliery ceased to carry on its business and, therefore, income received by assessee was assessable under head 'other sources', and that, assessee was to be assessed as an AOP - Tribunal, however, held that income derived by way of commission was business income of assessee and that assessee was to be assessed as firm - Lease deed on basis of which aforesaid findings were given by Tribunal, was not annexed to statement of case - Whether in such a situation, matter was to be remanded to Tribunal to peruse clauses of lease deed and, thereafter, decide matter afresh - Held, yes - (Matter remanded) FACTS The assessee, by an agreement, appointed a managing contractor for extraction of coal and from him the assessee received certain commission. The ITO came to the conclusion that the assessee, by giving to a managing contractor the complete control over the mines of the colliery, ceased to carry on its business and, therefore, the income received by the assessee was assessable under the head 'Other sources'. He also held that as there was no intention to carry on business, there could be no firm as such and treated the status of the assessee as an association of persons. The AAC held that the income received was business income. He further held that in the immediately preceding year the ITO making the assessment had treated the status of the assessee as that of a firm and that once the income was treated as income from business, there was no bar to treat the status of the assessee as firm. The Tribunal upheld the order of the AAC. On reference : HELD In the instant case, the lease deed on the basis of which the findings were given by the lower authorities was not annexed to the statement of the case. The case was adjourned several times, for filing of the lease deed by the parties but neither of the parties filed the lease deed, and in the absence of…

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