COMMISSIONER OF INCOME TAX Vs. PIONEER ENGINEERING SYNDICATE

JUDGEMENT

(1.) IN these three tax cases which are being disposed of by this common judgment, three questions fall for consideration. These are as follows :

(2.) THE first question arises out of the assessment proceedings for the assessment year 1969-70 and the second and third questions arise in respect of the assessment years 1967-68 and 1968-69.

(3.) THE assessee-firm was reconstituted with effect from January 1, 1966. Seven partners withdrew from the partnership. THE Vijayawada firm was also reconstituted. As a result of the reconstitution of both the firms, there were no common partners between the assessee-firm and the Vijayawada firm. THE new agreement of reconstitution dated January 1, 1966, was, however, styled as "agreement of dissolution". THE clause relevant for the purpose of these references in the agreement dated on January 1, 1966, reads as follows :