2010 (8) TMI 589

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..... er the income of association of persons shall not be taxable - Hence, a combined reading of the provisions would make it clear that there is no bar for a private company like the assessee from getting the benefits of Section 86 of the Act - Thus,the appeal is dismissed in favour of the assessee and against the revenue. No costs.
MR.JUSTICE F.M.IBRAHIM KALIFULLA, MR.JUSTICE M.M.SUNDRESH, JJ. For Appellant : Mr.J.Narayanaswamy Judgment M.M.SUNDRESH, J. The appeal has been filed by the revenue challenging the order passed by the Tribunal in ITA.No.1897/Mds/2008 whereby the order passed by the Commissioner of Income Tax (Appeals)-VI was confirmed. The revenue while filing this appeal has raised the following substantial question of la .....

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..... same, the revenue has come up on appeal by raising the substantial question of law referred above. 3. In order to appreciate the contentions of the learned counsel appearing for the appellant, it is useful to extract the provisions of Section 86 of the Income Tax Act which is as follows: "Where the assessee is a member of an association of persons or body of individuals (other than a company or a co-operative society or a society registered under the Sections Registration Act, 1860 (21 of 1860), or under any law corresponding to that Act in force in any part of India), income-tax shall not be payable by the assessee in respect of his share in the income of the association or body computed in the manner provided in section 67A: Provided .....

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..... d under Section 86 of the Act. 5. Further, a reading of Section 40(ba) of the Act would also make it clear that the share of the assessee under the income of association of persons shall not be taxable. Hence, a combined reading of the above said provisions would make it clear that there is no bar for a private company like the assessee from getting the benefits of Section 86 of the Act. 6. It is a well settled principle of law that in order to interpret a taxing statute, a literal interpretation will have to be given while interpreting the same. Unless the interpretation would lead to manifest in justice or absurdity such an interpretation cannot be given other than the literal interpretation. Therefore, considering the well settled pr .....

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