COMMISSIONER OF INCOME TAX Vs. ANANDILAL BHAGCHAND

JUDGEMENT

(1.) THE Income-tax Appellate Tribunal, Jabalpur Bench, Jabalpur, has referred the following question to this court for its opinion under Section 256(1) of the Income-tax Act, 1961 (hereinafter referred to as "the Act").

(2.) THE order of the Tribunal making the reference is dated September 1, 1982.

(3.) AS seen above, the order of reference made by the Tribunal is dated September 1, 1982. A proviso has since been added in Section 187(2) of the Act by the Taxation Laws (Amendment) Act, 1984, with retrospective effect from April 1, 1975. The proviso is to the effect that nothing contained in Clause (a) shall apply to a case where the firm is dissolved on the death of any of its partners. Clause (a) of Sub-section (2) of Section 187, on the other hand, provides that for the purposes of this section, there is a change in the constitution of the firm if one or more of the partners cease to be partners or one or more new partners are admitted, in such circumstance that one or more of the persons who were partners of the firm before the change continue as partner or partners after the change. AS a result of the proviso aforesaid being added with retrospective effect from April 1, 1975, the provisions of Section 187(2) of the Act, along with the said proviso, would be applicable to the facts of the instant case, the assessment order in question being of the year 1975-76. AS a consequence of the said proviso being added to Sub-section (2) of Section 187 of the Act, it is really Section 188 of the Act which will now apply to the facts and circumstances of the present case. Section 188 provides that where a firm carrying on a business or profession is succeeded by another firm and the case is not one covered by Section 187, separate assessments shall be made on the predecessor firm and the successor firm in accordance with the provisions of Section 170.