COMMISSIONER OF INCOME TAX Vs. GOLD WHEELS

JUDGEMENT

(1.) The Tribunal has referred the following question of law under Section 256(1) of the IT Act, 1961 (hereinafter referred to as "the Act"), for opinion of this Court: Whether, on the facts and in the circumstances of the case, and despite a provision in the partnership deed to the effect that the partnership would not stand dissolved on the death of a partner but shall continue with the remaining partners together with the heir(s) of the deceased partner, the Tribunal was legally justified in upholding the order of the learned CIT(A) to frame two separate assessments for the income of the two periods before and after the death of a partner ?

(2.) Brief facts of the case are as follows : The assessee/opposite party (hereinafter referred to as "assessee") was a firm constituted vide partnership deed dt. 7th Jan., 1973 stood dissolved on account of death of Smt. Laxmi Bhasin and in her place her legal heirs, Channan Shah Bhasin and her grandson Puneet Shah joined the partnership firm. For the asst. yr, 1984-85, assessee filed two returns, one for the period 19th Jan., 1983 to 14th Dec., 1983 disclosing the total income of Rs. 11,620 and another for the period 17th Dec., 1983 to 6th Feb., 1984 disclosing the total income of Rs. 17,210, The ITO clubbed the income of both the periods and made one assessment for the entire period 19th Jan., 1983 to 6th Feb., 1984. The ITO was of the view that in view of Clause 10 of the original partnership deed, which was executed on 7th Jan., 1973, the firm did not dissolve on the death of partner and there was only change in the. constitution of the firm under Section 187 of the Act. Appeal filed by the assessee was allowed by the CIT(A) and the direction was issued to make two assessments for the two separate periods. Revenue filed appeal before the Tribunal, which has been dismissed vide order dt. 30th May, 1994.

(3.) Heard Sri A.N. Mahajan, learned standing counsel for the Revenue. No one appears on behalf of the assessee.