TMI Blog1972 (5) TMI 5X X X X Extracts X X X X X X X X Extracts X X X X ..... ibunal, Delhi Bench "C", has submitted this statement of the case under section 256(1) of the Income-tax Act, 1961, seeking the opinion of this court on the following question of law: "Whether, on the facts and in the circumstances of the case, the Appellate Tribunal was right in holding that the assessee-company derives income from manufacturing or processing of goods and that the rebate should be allowed at 30 per cent? " The assessee is a private limited company and is a partner in a partnership firm styled as M/s. Hill Hardware Company, New Delhi, in which it has 50% share. While making the assessment for the year 1964-65 the Income-tax Officer had allowed a rebate @ 20% in the computation of corporation tax. The assessee moved an a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cided both the questions against the department. The Commissioner has sought this reference only on the second question, namely, as to whether the assessee is entitled to a rebate at 30%. Part II of the Finance Act, 1964, prescribes the rates of super-tax and surcharge on super-tax. Paragraph D of that Part relates to every company other than the Life Insurance Corporation of India. The rate of super-tax prescribed in the case of a company is 55%. Under the proviso a rebate is to be allowed to certain companies under specified circumstances. We are concerned with clause (iii)(A) of the proviso, which says that in the case of a company, which is wholly and mainly engaged in the manufacturing or processing of goods, rebate would be at 30 pe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion 4 of the Indian Partnership Act, a "partnership" is defined as the relation between persons who have agreed to share the profits of the business carried on by all or any of them acting for all. It follows, therefore, that the business carried on by a partnership firm is in reality the business carried on by the partners. When a firm is engaged in a business each partner shall be deemed to be so engaged. This principle appears to have been recognised by the Income-tax Act. When an assessment is made against a partnership firm carrying on business, the share of each partner is also assessed as income from business and not as income from other sources, even if a particular partner is not actively engaged in the business. In Sitaram Motiram ..... X X X X Extracts X X X X X X X X Extracts X X X X
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