TaxTMI 
TaxTMI 
1961 (3) TMI 2
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....sments ; the former are for the years 1946-47 and 1947-48 respectively, corresponding to the accounting years February 1, 1945, to September 30, 1945, and October 1, 1945, to August 21, 1946, and the latter are in regard to the chargeable accounting periods February 2, 1945, to September 30, 1945, and October 22, 1945, to March 31, 1946. The decision of the excess profits tax appeals is consequent upon the decision of the income-tax appeals. The facts may now be stated: In 1045 the Deputy Commissioner of Buldana evolved a scheme for the distribution of cloth in his district and with the sanction of the Government of C.P. appointed four persons, viz., Haji Ahmed Haji Ali & Co., Bhanji Kuwarji, Trimbaklal Tribhovan Das and Deolal Rangulal a....
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....ncome-tax Officer. Similarly for the year 1947-48 a notice was again issued and served on Haji Ahmed Haji Ali & Co. and similarly the group was assessed as an association of persons to income-tax and it was also assessed to excess profits tax for the period October 22, 1945, to March 31, 1946, and an application under section 27 of the Income-tax Act was dismissed in regard to this period also. Appeals were taken against the orders of assessments of income-tax and excess profits tax but they were dismissed by the Appellate Assistant Commissioner. Appeals were then taken to the Income-tax Appellate Tribunal but they also were dismissed by an order dated April 18, 1950. An application for making a reference to the High Court was dismissed b....
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....agreed share of profits. In our opinion the assessment has been rightly made in the status of an association of persons. " The High Court, when the matter went to it after the statement of the case by the Tribunal, held that before a group of persons could be called an " association of persons " it had to be established that they were in the nature of partners, i.e., the members of the group of their own volition or free will had joined in a venture with a view to earn profits. As the members of the group were appointed by the Deputy Commissioner as importers their participation could not be held to be of free will but it was under compulsion and, therefore, they were not an " association of persons " within the meaning of the Act. The Hi....