TMI Blog1998 (4) TMI 25X X X X Extracts X X X X X X X X Extracts X X X X ..... cer has assessed the income derived from the property in the hands of the "association of persons" rejecting the contention of the assessee for the assessment year 1981-82. When the matter went before the Appellate Assistant Commissioner, he annulled the assessment following the decision of this court in CIT v. Blue Mountain Engineering Corporation [1978] 112 ITR 839 as well as the order of the Tribunal Madras B1 Bench in I. T. A. Nos. 955 to 958 (Mad) of 1981, dated September 22, 1982, relating to the assessment years 1974-75 to 1977-78 in the case of the assessee itself. The Department took up the matter on further appeal to the Tribunal. The Tribunal, in turn following the decision of the Madras High Court in the case of CIT v. Blue ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... upreme Court in the case of ITO v. Ch. Atchaiah [1996] 218 ITR 239. In the Division Bench case of the Madras High Court, the assessment on a partner of an unregistered firm was made under section 144 of the Income-tax Act, 1961, including therein an estimate of his share of the income from the firm in which he was a partner. Thereafter, the assessment on the firm was made by the same Officer on an estimate, as no return was filed and treating it as an unregistered firm. The claim of the firm that once an assessment had been made on the partner including his share income from the firm, no assessment on the firm could, thereafter, be made was negatived by the Income-tax Officer and the Appellate Assistant Commissioner, but upheld by the Tri ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s that income-tax shall be charged on the total income "of every person" and the expression "person" is defined in clause (31) of section 2. The definition merely says that the expression "person" includes, inter alia, a firm and an association of persons or a body of individuals whether incorporated or not. There are no words in the present Act which empower the Income-tax Officer or give him an option to tax either the association of persons or its members individually or for that matter to tax the firm or its partners individually. If it is the income of the association of persons in law, the association of persons alone has to be taxed ; the members of the association of persons cannot be taxed individually in respect of the income of ..... X X X X Extracts X X X X X X X X Extracts X X X X
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