BHAGMAL SAUDAGAR MAL Vs. COMMISSIONER OF INCOME TAX

JUDGEMENT

(1.) Heard learned counsel for the parties.

(2.) The facts of the case are that the assessee is an unregistered firm and the relevant assessment year is 1978-79. Saudagar Mal and Ram Lal are two partners of the firm. Both these partners filed their individual returns declaring their income from the firm and these returns were accepted by the ITO, B Ward, Dehradun, under Section 143(1) of the IT Act, on 7th Nov., 1978, and 10th Nov., 1978, respectively. Subsequently the firm was called upon to file its return of income for asst. yr. 1978-79 by the ITO, C-Ward, Dehradun, and the return was duly filed by the assessee-firm and an assessment was made by the ITO, C-Ward, Dehradun, on 19th March, 1981. The assessee challenged the validity of the assessment before the AAC and contended that the assessment on the partners of the firm having already been made there was no justification in law for making the assessment on the firm in respect of the same income which has been assessed in the hands of the partners. However, the AAC rejected the claim and his order was upheld by the Tribunal which dismissed the claim following the decision of the Punjab and Haryana High Court in the case of Rodamal Lalchand v. CIT (1977) 109 ITR 7 (P&H).

(3.) Thus, the question which arises in this case is whether the assessment of the assessee-firm was valid when two of its partners had already been assessed individually in respect of their shares in the income of the firm.