A P SIVARAMAN Vs. INCOME TAX OFFICER

JUDGEMENT

(1.) PETITIONERS 1 to 3 and 5 and one Kunhiraman, the husband of the 4th petitioner, to whom I shall hereinafter refer as the petitioners, were employees of a firm M/s New Anandsagar Colour Merchants, Kannoor. According to the petitioners they were receiving salary from the firm as per the agreement entered into with the latter as a percentage of the net profit of the firm. It is said that the agreement, however, provided that the amount credited to the petitioners will be paid and allowed to be withdrawn only if the IT Department allowed the same as an admissible deduction in the assessment of the firm.

(2.) PETITIONERS filed returns for the years 1980-81 to 1983-84, returning the various amounts received by them as salary from the firm. These returns were accepted in toto as they were and the assessments completed on the petitioners for these years, copies of which are Exts. P1 to P14.

(3.) PETITIONERS applied for rectification of their assessments by filing applications Exts. P15 to P27 to make them in accord with the firm's assessments. Some of these applications were delayed being filed out of the period prescribed by s. 154 of the IT Act, 1961 and, therefore, the petitioners filed applications Exts. P28 to P32 before the CBDT (4th respondent) under s. 119(2) of the Act to condone the delay in filing the applications and to issue directions to the first respondent assessing authority to dispose of the petitioners' applications Exts. P15 to P27 on merits. The controversy arises hereafter.