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2019 (2) TMI 221 - AT - Income TaxTreatment as member of AOP - only grievance of the assessee that is to be addressed is that whether Deepali is a member of the AOP or not? - Held that:- It is imperative that the AO must first decide that whether M/s. Deepali Design and Exhibits Pvt. Ltd is a member of PICO Deepali Overlays and Consortium as a member of PICO Deepali Overlays Consortium or not. Further, it is claimed that by subsequent agreements Deepali has exited the AOP. It could not be ascertained from the assessment orders that those agreements were before the lower authorities or not. Even if they are placed before lower authorities whether they have been examined from the angle of the controversy raised before us. It is stated that Deepali was not the members of the AOP after 1/6/2010. It is also not prohibited that member originally member of AOP cannot exit the AOP. Therefore this aspect needs greater examination by the AO. Further Deepali apparently did not have any opportunity to show to the assessing officer that it The LD AO opportunity of hearing to the Deepali. Thereafter, If it is held to be a member of the AOP , then it should be given a proper opportunity of hearing and then the ld AO should pass a fresh assessment order in accordance with law. If Deepali Design and Exhibits Pvt. Ltd is held to be not a member of AOP, then it does not have any locus standi in the present appeal against those orders passed by the lower authorities and further the tax demand raised on the AOP is not recoverable from the Deepali Design and Consortium Pvt. Ltd but by other means . In view of this, we set aside ITA for Assessment Year 2011-12 filed in the name of PICO Deepali Overlays Consortium and signed by Deepali Design and Exhibits Pvt. Ltd back to the file of the ld AO, with a direction to first decide whether Deepali Design and Exhibits Pvt. Ltd is a member of AOP or not. If it is held to be a member, then Deepali be given a proper opportunity of hearing on the merits of the various additions made in the assessment order u/s 69A and other disallowances u/s 37 in the hands of assessee AOP. After that ld AO may pass an order on assessee AOP in accordance with law and all other consequences u/s 177 (3) of the act Shall also be applicable on Deepali. Order passed u/s 177(3) of the act by the AO is neither disputed before us in this appeal nor before the lower authorities. Therefore as the same was not subject matter of this appeal we do not adjudicate the same.
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