BALASUBRAHMANYAN J.

The question referred to us by the Income-tax Appellate Tribunal in this reference reads as follows :

"Whether, on the facts and in the circumstances of the case, the Tribunal was correct in uphlding the order of the commissioner of Income-tax ?" *

The question does not indicate what the order of the Commissioner of Income-tax was, on what basis the Tribunal upheld it as correct, and what was nature of the controversy raised by the assessee on it. A perusal of the sated case, however, tell us what the question is all about, a mercy for which we must be thankful. The assessee is a partnership firm carrying on A business of its own. It also indulged in a joint venture in sugar in association with certain other firms. While returning its income for 1969-70, the assessee displayed therein its share income from the joint venture. The Income-tax Officer accepted the return as he found it, and made an assessment on the basis of the return, charging to tax the total income income from the joint venture. Subsequently, the Commissioner of Income-tax initiated proceedings for suo moturevision under section 263 of the Income-tax Act, 1961, on the score that the Income-tax officer action in so far as he brought to charge the assessee's share income from the joint venture was prejudicial to the interest of the Revenue. Accounting to the Commissioner of Income-tax Officer should have considered assessing the joint venture income in the hands of the association of persons as a whole. By assessing the share income in the individual assessment of this assessee, the Income-tax Officer had put it out of his reach to get at the association of persons as a body and as a taxable entity. It was apparently the view of the Commissioner of Income-tax that the average rate of tax appertaining to the total income of the association of persons was higher than the average rate of tax at which the share income was taxed appertaining to the members of the association of persons. He accordingly set aside the assessment in this case and directed Income-tax Officer to first make an assessment on the association of persons as such and then follow it up with the assessment of the share income of the assessee as member of that association.This order of the Commissioner of Income-tax was confirmed by the Tribunal in appeal. The order of the Tribunal has given raise to the present reference. Two questions were debated before us on the the tax treatment of the association of persons vis-a-vis the individual members thereof. The other question was about the powers of the Commissioner of Income-tax to interfere with the orders of the Income-tax Officer as prejudicial to the interest of the Revenue.

On the first question, it may be said that the position is now fairly well settled. Over a period of years, courts have held that when once an Income-tax officer makes an assessment of the share income of a member of an association, thereafter he could not proceed to asses the income of association of person as such. All that would remain to be done in such a case would be for the Income-tax officer to proceed to deal with the other members shares of income in their respective individual assessments. This position has been laid down as the pattern of assessment in all cases where an association of persons as such earn income in which the members thereof would be entitle to their aliquot shares. It may be conceived that this position regarding the modes of assessment of the association of persons on the one hand and on the members of the association on the other was somewhat clear under the Indian Income-tax Act, 1922, than they are under the present Income-tax Act, 1961. However, it can be taken as fairly well settled now that the position is the same even under the present statute, to this effect, there is a ruling of Bench of our court in CIT v. R. Dhandahutham. To the same effect are the decision of Andhra Pradesh and Calcutta High Courts, vide