COMMISSIONER OF INCOME TAX Vs. CHUHARMAL MANGHANDAS

JUDGEMENT

(1.) THIS is an application under S. 256(2) of the IT Act for calling the reference and in pursuance of that, this reference was called by this Court and the following question of law has been referred by the Tribunal for answer of this Court, which reads as under :

(2.) THE brief facts giving rise to this reference are thus : The assessee is a firm and the asst. yr. 1978 79. The assessee firm M/s. Chuharmal Manghandas, general merchant, Neora, Raipur, was constituted by an instrument of partnership dt. 15th Nov., 1973. The details of the partners and their respective shares in the profits and losses of the business of the firm were as under : Clause 11 of the said instrument of partnership stipulated :

(3.) WE have heard the learned counsel for the parties and perused the records. Apparently, the view taken by the Tribunal does not appear to be correct. The Tribunal relied on a decision of the Allahabad High Court given in Badri Narain Kashi Prasad vs. Addl. CIT 1978 CTR (All) 390 (FB) : (1978) 115 ITR 858 (All)(FB) : TC 34R.407, but that decision has already been over ruled by the Hon. Supreme Court in Wazid Ali Abid Ali vs. CIT (1988) 67 CTR (SC) 43 : AIR 1988 SC 757 : TC 34R.439 and not only the Full Bench decision of this Court but that of other Courts were considered by their Lordships of Hon. Supreme Court and their Lordships held :