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of <h1>Appeal success: Avoiding double taxation post-partnership dissolution.</h1> <h3>M/s Destiny Consultants Versus Income Tax Officer, Ward- 2 (2), Jaipur.</h3> M/s Destiny Consultants Versus Income Tax Officer, Ward- 2 (2), Jaipur. - TMI Issues:1. Validity of reopening of the assessment.2. Addition made by the Assessing Officer based on 26AS transactions.Issue 1: Validity of reopening of the assessmentThe appeal challenged the order dated 29/12/2017 of ld. CIT(A)-I, Jaipur for the A.Y. 2008-09. The assessee raised grounds of appeal questioning the legality and validity of the notice issued under Section 148 and the subsequent order passed under Section 147. Ground No. 1 regarding the validity of reopening the assessment was dismissed as not pressed since the assessee did not wish to pursue it.Issue 2: Addition made by the Assessing Officer based on 26AS transactionsThe Assessing Officer made an addition of Rs. 14,38,265/- based on transactions shown in 26AS as the assessee firm received this amount from various parties. The assessee explained that the partnership firm was dissolved, and the amount belonged to the proprietorship concern of Shri Sanjeev Soni. The ld. CIT(A) upheld the addition, stating that the partnership firm did not surrender the PAN post-dissolution. The assessee contended that the TDS was mistakenly deducted under the dissolved partnership firm's PAN. The Tribunal noted that the receipts were part of the proprietorship concern's income, matching the amounts in the P&L account. The Assessing Officer for A.Y. 2009-10 accepted this explanation. Therefore, the Tribunal held that assessing the income in the dissolved partnership firm's hand was unjustified, leading to double taxation. The addition made by the Assessing Officer was deleted, and the appeal was partly allowed.In conclusion, the Tribunal addressed the issues of the validity of reopening the assessment and the addition made by the Assessing Officer based on 26AS transactions. The judgment highlighted the importance of clarifying the ownership of income post-dissolution of a partnership firm and ensuring no double taxation occurs due to TDS errors.
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