TaxTMI Login
AI OCR ✕Convert scanned orders, printed notices, PDFs and images into clean, searchable, editable text within seconds. Starting at 2 Credits/page
Try Now →Just a moment...
AI OCR ✕Convert scanned orders, printed notices, PDFs and images into clean, searchable, editable text within seconds. Starting at 2 Credits/page
Try Now →
Press 'Enter' to add multiple search terms. Rules for Better Search
Use comma for multiple locations.
---------------- For section wise search only -----------------
Accuracy Level ~ 90%
of 
Press 'Enter' after typing page number.
of Press 'Enter' after typing page number.
No Folders have been created
Are you sure you want to delete "My most important" ?
NOTE:
of Press 'Enter' after typing page number.
of Press 'Enter' after typing page number.
All Case Laws
of Press 'Enter' after typing page number.
of Press 'Enter' after typing page number.
All Case Laws
Note
Bookmark
Share
Don't have an account? Register Here
of Press 'Enter' after typing page number.
Issues: (i) Whether the firm was resident and ordinarily resident in British India under Section 4-A(b) of the Indian Income-tax Act, 1922 because any part of its control and management was exercised in British India. (ii) Whether proceedings under Section 34 of the Income-tax Act, 1922 could be initiated against the firm when one partner had already been assessed individually on his share of the firm's profits.
Issue (i): Whether the firm was resident and ordinarily resident in British India under Section 4-A(b) of the Indian Income-tax Act, 1922 because any part of its control and management was exercised in British India.
Analysis: The firm's affairs were managed through an agent in Ceylon, but the correspondence showed that the partner in British India selected and sent the agents, issued instructions regarding wages, labour, production costs and sale of produce, received regular accounts and reports, and in fact participated in the management of the business. Under the statutory test, residence follows if even part of the control and management is exercised in British India.
Conclusion: The question was answered in the affirmative and against the assessee.
Issue (ii): Whether proceedings under Section 34 of the Income-tax Act, 1922 could be initiated against the firm when one partner had already been assessed individually on his share of the firm's profits.
Analysis: A firm is a distinct assessable unit for income-tax purposes, separate from its partners. The individual assessment of a partner does not bar assessment of the firm for the same year. Since action under Section 34 was taken within the statutory period, the reassessment of the firm was permissible.
Conclusion: The question was answered in the affirmative and against the assessee.
Final Conclusion: The references were answered in favour of the Revenue on both questions, and the assessee was made liable for the costs awarded in the revenue's favour.
Ratio Decidendi: For a firm, residence under Section 4-A(b) depends on whether any part of its control and management is exercised in British India, and a prior individual assessment of a partner does not preclude reassessment of the firm under Section 34 where the statutory conditions are satisfied.
TaxTMI 
TaxTMI 
