JAYANTHI TALKIES DISTRIBUTORS Vs. COMMISSIONER OF INCOME TAX

JUDGEMENT

(1.) THE following question has been referred to us under Section 256(1) of the I.T. Act, 1961 (hereinafter referred to as "the Act"), for our opnion at the instance of the assessee :

(2.) THE assessee-firm consisting of five partners, (1) Shri P. Kandaswamy Pillai, (2) Shri C. Palani Velayutham Pillai, (3) Shri P. Alagam Perumal, (4) Shri S. Marimuthu and (5) Shri S. Somasundaram Pillai, was constituted with effect from May 25, 1957, for carrying on the business of film distribution. Clause (iv) of the partnership deed provided that Shri Kandaswami Pillai should manage the affairs of the partnership as its managing partner.

(3.) THE assessee then preferred an appeal to the Tribunal against the order of the AAC holding the appeal against the assessment under Section 144 as infructuous, on the ground that the assessment order under Section 144 was invalid as the notice under Section 148 was not validly served on the assessee and, therefore, it should have been set aside. In that appeal, it was contended that there had been no proper service of notice under Section 148, that the service of such a notice being a prerequisite for initiating proceedings under Section 147, the reassessment cannot be held to be valid. THE Tribunal, however, held that the notice under Section 148 having been served on Balakrishna Pillai and acknowledged by him as the manager of the firm, the reassessment was valid and proper. Aggrieved against the decision of the Tribunal, the assessee has approached this court by way of this reference.