2003 (3) TMI 85

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....g aggrieved by the decision of the Department to reopen the assessment vide impugned notice dated March 28, 2002, under section 148 of the Income-tax Act, 1961, this petition has been moved under article 226 of the Constitution. In this petition, we are concerned with alleged escapement of income for the assessment year 1995-96. Facts: L.R. Patel Family Trust was owning a flat bearing No. 14....

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....tion 148 of the Income-tax Act on March 28, 2002. Being aggrieved, the petitioners have filed this petition. Arguments: Mr. Mistry, learned counsel appearing on behalf of the petitioner, submitted that the key issue involved in this petition is : whether section 45(4) is at all attracted. He contended that section 45(4) would apply only if profits arose from the transfer of a capital asset b....

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....he trustees did not fall under section 2(31)(v). Mr. R.V. Desai, learned senior counsel appearing on behalf of the Revenue, however, contended that under section 164(1) of the Act, where any income arises to the persons mentioned in section 160(1), then such persons were liable to be taxed as representative assessee. That, in the present case, the trustees fell within the definition of the expr....

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....of persons. Basically, in order to constitute an association of persons, persons must come together with the object of earning profits. In the case of CIT v. Marsons Beneficiary Trust [1991] 188 ITR 224, it has been held by the Bombay High Court that the trustees who are authorised to carry on business under the trust deed derive their authority from the settlor and not from the beneficiaries and,....