1990 (9) TMI 359

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..... J. In this reference under section 236(1) of the Income-tax Act, 1961 ('the Act') for the assessment years 1980-81 and 1981-82 the following question of law has been referred to this Court: Whether, on the facts and in the circumstances above, the Tribunal was justified in upholding the action of the ITO in including in the assessee's total income the share income .....

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..... ion before the Calcutta High Court and that the assessee had not received any share from the firm. The AAC directed the ITO not to include income from the partnership firm in the total income of the assessee. It was further observed by the AAC that in case the High Court decides that the assessee had ascertained share of profit from the firm, the ITO could rectify his order under section 154/155 o .....

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..... l income of the assessee presumably on the basis of the accounts filed by the assessee. The Tribunal was of the view that the lower appellate authority was in error in directing the exclusion of the share of the assessee in the income of the firm from its total income. The Tribunal set aside the order of the lower authority for the two years and restored those of the ITO. 4. At the hearin .....

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..... nd by the facts found by the Tribunal. Since none of the findings has been challenged before us, we have to proceed on the basis of the facts found and/or admitted by the Tribunal. However, our answer to the question in this reference on the basis of the facts found by the Tribunal will not prevent the assessee to challenge the assessment order in the case of the firm or the assessment made in thi .....

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..... that the Tribunal proceeded on the footing that the assessee was following the mercantile system of accounting, in terms of section 182(1) such income is includible, being the assessee's share in the profit of the firm in the total income of the assessee. 6. For the reasons aforesaid, we answer the question in this reference in the affirmative and in favour of the revenue and against .....

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