TMI Blog1997 (10) TMI 90X X X X Extracts X X X X X X X X Extracts X X X X ..... eding. 2. The learned counsel appearing for the assessee before us, has brought our notice to the reasons recorded by the Assessing Officer for initiating proceedings under section 147, as extracted by the CIT (Appeals) at page 3 of his impugned order. For the sake of ready reference, we are also extracting the said reasons below: "14.11.83. Notice under section 143(2) for the assessment years 1977-78 to 1980-81 issued. D.H. 3-12-83. Notice under section 148 for the assessment year 1981-82 1982-83 and notice under section 139(2) for the assessment year 1983-84 issued. Sd/-ITO". It is evident from above that the Assessing Officer did not at all record any reasons for issuing the notice under section 148. The learned DR has tried to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... v. I.B.M. World Trade Corpn. [1995] 216 ITR 811 (Bom.). 3. Taking into consideration all the above decision and also the basic facts relating to this case regarding non-recording of reasons for issuing notice under section 148, we hold that the assessment proceeding is invalid. 4. Thereafter, the learned counsel for the assessee has challenged the validity of the assessment from another angle also. He contends that it is an acknowledged fact that the assessee-firm was dissolved with effect from 1-4-1976, but the assessment has, however, been made in the hands of the firm by considering it to be a URF by the Assessing Officer on 28-2-1986. The learned counsel for the assessee has relied on a decision of the Karnataka High Court in the ca ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sing by way of compensation received by the ex-partners of the firm on acquisition of the buses belonging to the firm by the State Government, can in no way, be assessed to tax in the hands of the firm in this year. Any legal doubt on this issue now stands settled by a recent decision of the Supreme Court in the case of CIT v. Artex Mfg. Co. [1997] 227 ITR 260. In that case also, certain income was sought to be assessed in the hands of the firm which had already been dissolved, under the provisions of section 41(2). The Supreme Court agreed with the decision of the Gujarat High Court as reported at Artex Mfg. Co. v. CIT [1981] 131 ITR 559/5 Taxman 109 that the assessee could not be taxed as the registered firm but that the partners of the a ..... X X X X Extracts X X X X X X X X Extracts X X X X
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