TMI Blog2006 (11) TMI 173X X X X Extracts X X X X X X X X Extracts X X X X ..... -tax Act, 1961, was partly withdrawn excluding share income received from the partnership firms. The second issue is on the respondent's eligibility for deduction under section 32AB on income received as shares from the partnership firms. We have heard counsel appearing for both sides. The respondent-assessee besides being engaged in production of steel in their factory was a partner in three firms during the assessment year 1990-91. In the assessment completed under section 143(3) of the Act, the respondent-assessee was granted relief under section 32AB at 20 per cent. of the total income from business including the share income received from the three partnership firms. Admittedly, the business income earned by the assessee was Rs. 20,6 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... was admittedly engaged in an eligible business which entitles it under section 32AB to a deduction on the investment in purchase of plant, machinery etc., for the industry or on making a deposit in a special account within the time prescribed therein subject to a ceiling of 20 per cent. of the total business income earned by the assessee. There is no dispute with regard to the eligibility for deduction in all other respects except in regard to the amount involved. As already stated above, Rs. 14,81,010 does not represent business income of the assessee, but the said amount is the total of share income received by the assessee as partner in three separate firms. The question is whether this amount also can be treated as business income for t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... profession as computed in the accounts of the assessee audited in accordance with sub-section (5), whichever is less: Provided that where such assessee is a firm, or any association of persons or any body of individuals, the deduction under this section shall not be allowed in the computation of the income of any partner, or, as the case may be, any member of such firm, association of persons or body of individuals... (2) For the purposes of this section,- (i) 'eligible business or profession' shall mean business or profession, other than- (a) the business of construction, manufacture or production of any article or thing specified in the list in the Eleventh Schedule carried on by an industrial undertaking which is not a small sc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f ours answers the question on the merits against the assessee and in favour of the Revenue. Counsel for the assessee contended that only apparent errors or mistakes could be rectified under section 154 as held by the Supreme Court in T.S. Balaram, ITO v. Volkart Bros. [1971] 82 ITR 50. Counsel also pointed out that the question is a debatable one and the same is evident from the fact that the two appellate authorities interpreted the section in favour of the assessee which itself is enough evidence to show that it is a debatable issue. Standing counsel on the other hand contended that the issue would have been debatable but for the proviso introduced later by an amendment which expressly bars the claim. As stated above, the proviso is ca ..... X X X X Extracts X X X X X X X X Extracts X X X X
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