1983 TAX. L. R. 1649 ::(1983) 37 CurTaxRep 148 ::(1983) 14 Taxman 248 ::(1983) 143 ITR 269

Madras High Court

Hon'ble Judge(s): Ramanujam, Shanmukham , JJ

Income-tax Act (43 of 1961) , S.67(2), S.80-T, S.154— Rectification of order - Assessee claiming benefit under S. 80-T r/w S. 67(2) - S. 67(2) inapplicable - Relief granted under S. 80-T was mistake apparent on face of record - Rectification under S. 154, justified. The assessee was a partner in a firm which had made certain capital gains on sales of certain assets. However the loss under the head "business" was more than capital gains. The capital gains was set off against the business loss and the loss remaining after setting off was distributed between the partners of the firm. The assessee claimed relief under S. 80-T r/w. S. 67(2) and the I. T.O. granted relief under S. 80-T which was later cancelled by rectifying it under S. 154. The assessee contended that in view of S. 67(2) the business loss as well as the income from the capital gains should be brought into the assessee's account and the allocation of the income or loss should be made under corresponding heads of income in the partner's assessment. The assessee further contended that the relief granted under Section 80-T was not rectifiable under S. 154 as the applicability of S. 80-T to assessee's case was not a mistake, if any, apparent on the face of the record. Held (i) Section 67(2) does not enable the assessee to ignore the assessment made on the firm and insist on a fresh asse....