2004 (10) TMI 78

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.... under section 148 of the Income-tax Act, 1961 (for short, "the Act"), and has sought quashing of annexure P. 2 and the order passed on objections (annexure P. 1). The petitioner had filed the return for the assessment year 2003-04 in the status of a firm and an intimation under section 143(1) of the Act for giving refund of Rs. 2,00,450 was issued. The petitioner had shown the rental income from warehouse business in pursuance of the partnership deed and had claimed deduction of salary and interest paid to the partners. The Assessing Officer had issued a notice under section 148 of the Act (annexure P. 2) on the premise that the said income does not fall within the ambit of "business income" and shall be income from other sources and, t....

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....r, noticed as under: "It was clearly mentioned that section 4 of the Indian Partnership Act, 1932 defined partnership as 'relationship between the persons who have agreed to share the profits of business carried on by all or any of them acting for all' meaning thereby that a firm could be formed if it derived income from 'business or profession' only and if the income derived is not from business, no partnership existed and consequently the said concern was not entitled to the status of 'firm'. By simply mentioning the words 'business' in the partnership deed executed on April 1, 2001 does not mean that it is mandatory for the Department to assess the income under the head 'Income from business or profession'. Accordingly, your objection....