SHANTHI DIAMONDS Vs. INCOME-TAX OFFICER

JUDGEMENT

(1.) ITA No. 3862/Mds/88 is an appeal by the revenue relating to the assessment year 1982-83, ITA No. 3612/Mds/88 is an appeal by the assessee also relating to the assessment year 1982-83 and ITA No. 3613/Mds/88 is an appeal by the assessee relating to the assessment year 1983-84.

(2.) We first take up the appeals for the assessment year 1982-83. For this year the assessment order was passed by the ITO, City Circle-II (2), Trichy on 21-3-1985 on the assessee in the status of a registered firm. The accounting period adopted was the financial year 1-4-1981 to 31-3-1982. The income as computed was Rs. 10,58,070 against income returned of Rs. 46,966. The main additions both under the head other sources was (a) investment of Rs. 11,100 and income outside the books computed at Rs. 10,00,000. This income outside the books was computed consequent to a comparison made by the ITO between entries in certain documents which were obtained during a search on 20-10-1982, and the accounts as maintained by the assessee. The income computed was allocated amongst seven partners. The partners and their shares were as under : <FRM>JUDGEMENT_79_LAWS(MAD)3_1990_1.html</FRM>

(3.) B. K. N. Kanna filed an appeal Against the order of assessment to the CIT (Appeals)-V, Madras who was the Commissioner who had jurisdiction over the assessee at the material time. This appeal was filed on 20-4-1985. While this appeal was pending apparently because the other group of partners headed by Rajaram had not received the copy of the assessment order, they applied for the copy of the assessment order which was duly furnished to them and an appeal signed by partner Rajaram was filed this time before the CIT (Appeals), Madurai on 26-9-1986. This appeal came to be filed before the CIT (Appeals), Madurai apparently because by that time as assessment jurisdiction has been transferred from Trichy to the ITO, Circle-II (5), Madurai