9911796707
TMI Blog2016 (4) TMI 260X X X X Extracts X X X X X X X X Extracts X X X X ..... t only natural legal persons can be partners in a partnership firm? - Held that:- The show cause notice issued by the Appellate Commissioner was obviously wrong, it was liable to be set aside. The writ petition is allowed and the impugned order in the writ petition is set aside on the sole ground that the finding that a firm cannot be a partner in a partnership firm, is contrary to law. - Writ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er Section 143(3) on 30.3.2015. 4. Aggrieved by the order of assessment, the appellant filed a first appeal before the Commissioner of Income Tax (Appeals). During the pendency of the appeal, the Appellate Commissioner issued a show cause notice dated 6.11.2015, questioning the very status of the appellant as a partnership firm and calling upon the appellant to show cause as to why their status ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... issioner of Income Tax (Appeals), the Appellate Authority thought that a firm cannot be a partner in another firm and that only natural legal persons can be partners in a partnership firm. This fundamental error, committed by the Commissioner of Income Tax (Appeals) has led to the disallowance of an expenditure claimed towards remuneration and interest paid to partners. 8. There is no law, whic ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Commissioner does not even have the power to alter the status of an assessee in the course of the appellate proceedings. 12. But, a careful look at the decision of the Jharkhad High Court would show that the Jharkhand High Court found fault with the Appellate Commissioner on two grounds namely (i) that he had pre-concluded the issue in the show cause notice itself and (ii) that in an appeal ari ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ommissioner was obviously wrong, it was liable to be set aside. 15. Therefore, without expressing any opinion on the power of the Appellate Commissioner, we allow the writ appeal and set aside the order of the learned Judge. The writ petition is allowed and the impugned order in the writ petition is set aside on the sole ground that the finding that a firm cannot be a partner in a partnership f ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
