High Court Of Rajasthan : Jaipur Bench
CIT vs. Ganeshdas Jagdish Prasad
Section 187
Asst. Year 1972-73
J.S. Verma, C.J. & I.S. Israni, J.
DB IT Ref. No. 56 of 1981
15th March, 1988
Counsel Appeared
Mr. D.P. Govil, for the Revenue
BY THE COURT :
This reference under s. 256(1) of the IT Act, 1961, is at the instance of the Revenue to answer the following question of law, namely :
” Whether, on the facts and in the circumstances of the case, and having regard to the provisions of s. 187(2)(a) of the IT Act 1961, the Tribunal was justified in directing that two assessments should be made in this case in respect of the periods Kartik Sudi 1, Samwat 2027 to Falgun Badi 1, Samwat 2027 and Falgun Badi 2, Samwat 2027 to Kartik Badi 30, Samwat 2028 ? “
The relevant assessment year is 1972-73. The partnership consisted initially of four partners, namely, Sv.Jainarain, Tejraj, Jagdish Prasad & Amarchand, each having equal share. The deed of partnership was executed on June 3, 1961. On February 11, 1971, during the relevant assessment year, one of the partners, Tejraj, expired and the three surviving partners admitted the minor son of Tejraj to the benefits of partnership and took over the assets and liabilities of the firm. A new partnership deed was drawn up on February 25, 1971. Two returns of income were filed, one for the period ending on February 11, 1971 and the other for the remaining period of the accounting year. The assessee claimed that separate assessments had to be made for these two periods. The ITO rejected the contention holding that it was a case of a mere change in the constitution of the assessee-firm in terms of s. 187(2)(a) of the Act and as such only one assessment had to be made for the entire assessment year. The assessee’s appeal to the AAC was, however, accepted upholding the assessee’s contention. The Tribunal has also taken the same view. Hence, this reference at the instance of the Revenue.
The point involved for decision by us is concluded by a recent decision of the Supreme Court in Addl. CIT vs. United Commercial Co. (1988) 67 CTR (SC) 43 : (1988) 169 ITR 761. Following that decision, the Revenue’s contention is to be rejected and the Tribunal’s view must be held to be justified.
Consequently, the reference is answered against the Revenue and in favour of the assessee by holding that the Tribunal was justified in directing that two assessments should be made for the relevant assessment year.
No costs.
[Citation : 173 ITR 622]
