M.R. ASSOCIATES Vs. INCOME TAX APPELLATE TRIBUNAL

JUDGEMENT

(1.) This appeal is filed by the assessee under section 260A of the Income-tax Act, 1961, against the judgment and order dated August 25, 2006, passed by the Income-tax Appellate Tribunal, Lucknow, in I. T. A. No. 285/Luc/04 for the assessment year 1995-96.

(2.) This court, vide order dated January 3, 2007, has admitted the appeal on the following substantial questions of law :

(3.) The brief facts of the case are that the assessee-appellant is a partnership firm, engaged in the business of construction, development and sale of buildings. The partners of the appellant-firm are Sri Mool Raj and Smt. Asha who have equal share in the profit or loss of the firm. The firm has its office at Madan Mohan Malviya Marg, 13, Jopling Road, Lucknow. Originally, the assessee-firm has filed the return of income for the assessment year under consideration on October 31, 1995, by showing the income of Rs. 2,670 after completing the building known as Asha Apartment I and II. The Assessing Officer was not satisfied, so, he has referred the matter pertaining to the Asha Apartments to the D.V.O who has submitted his report on August 20, 1996. On the basis of the report, a notice under section 148 was issued for the assessment year under consideration (1995-96). The Assessing Officer has passed the reassessment order on March 31, 1999, and estimated the total income of Rs. 33,28,590 but the same was substantially deleted by the Commissioner of Income-tax (Appeals) and the appellant-firm was finally assessed at Rs. 85,508, vide order dated January 4, 2000.