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Issues:
1. Whether the combination of two partnership firms forming a joint venture can be considered a "person" for tax purposes under the Income-tax Act, 1961. 2. Whether the income earned through the joint venture can be subjected to further assessment. Analysis: 1. The petitioners, two partnership firms forming a joint venture, challenged a notice under section 139(2) of the Income-tax Act, 1961. The respondent argued that the joint venture constituted a "person" under section 2(31), sub-clause (v) of the Act. The court examined relevant case law and determined that a partnership firm is not a legal entity but a collective name for individual members. As such, the joint venture could not be considered an association of persons or body of individuals, as it lacked juristic legal entity status. The court held that the Income-tax Officer lacked jurisdiction to issue the notice to the joint venture, setting aside the impugned notice. 2. Regarding the second issue, the court found that the income from the joint venture had already been disclosed, assessed, and taxed by the respective petitioner firms. Previous judgments by single judges supported the position that once income from the joint venture had been assessed and tax levied, it was impermissible for the authorities to seek further returns for the same income. The court deemed any attempt to levy tax on the joint venture as double taxation, ruling in favor of the petitioners. Consequently, the impugned notice was set aside, and the interim order was confirmed, with no costs awarded. In conclusion, the High Court of CALCUTTA, in the judgment delivered by Judge KALYAN JYOTI SENGUPTA, upheld that the joint venture of two partnership firms could not be considered a "person" for tax purposes and that the income from the joint venture, having already been assessed and taxed, could not be subjected to further assessment. The court's decision favored the petitioners, setting aside the impugned notice and confirming the interim order without costs.
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