COMMISSIONER OF INCOME TAX Vs. ANUPAM UDYOG

JUDGEMENT

(1.) ON an application for reference under Section 256(1) of the I.T. Act, 1961 (hereinafter referred to as the "Act "), a statement of the case has been submitted to this court by the Income-tax Appellate Tribunal, Patna Beech, referring the following question of law for the opinion of this court:

(2.) THE facts which are beyond the pale of controversy and as emerged out of the statement of the case submitted to this court can be culled thus. THE assessee is a firm which commenced its business from February 14, 1967. That was the first year of the firm's business. THE assessee derives income from business in ghee and mustard oil. A return had been filed showing an income of Rs. 3,016 in the status of a firm. THE assessee, however, did not the any application for registration of the deed of part- nership and, therefore, it was treated as an association of persons by the ITO, who was the assessing authority. This fact is borne out from the assessment order of the IT'0, which has been appended as annex. A forming part of the statement of the case. THE assessee started its business from February 14, 1967. On that date, four of the five partners brought a capital of Rs. 5,001 each, and this amount was credited in the books of the firm on the first day of its business. This fact is borne out, apart from the statement of the case as submitted to this court by the Tribunal, by the appellate order of the Tribunal, which has been appended to the statement of the case as annex. C thereto. THE fifth partner did not subscribe anything, presumably because he was supposed to be a working partner.

(3.) SECTION 68 of the Act reads thus :