LACHMINARAYAN MODI Vs. COMMR OF INCOME TAX

JUDGEMENT

(1.) This is a reference under Section 66 (1) of the Indian Income-tax Act made by the Income-tax Appellate Tribunal, Bombay Branch. The assessee is an undivided Hindu family represented by Lachminarayan Modi, the Karta of the said family. Lachminarayan has four brothers who separated long ago. The assessee family carried business mainly in salt and in other articles, such as, Kerosene Oil, Petrol &c. The Head Office was in Cuttack, and there were branches also in Ichhapur, Ganjam &c. In Ichhapur, the Firm, known as Tilakchand Hariram, carried on business in manufacture of salt, the partners in the business being Lachminarayan, the 'Karta' of the assessee family, and his divided brothers. Owing to differences between the partners, Lachminarayan brought Original Suit No. 6 of 1941 in the Court of the Subordinate Judge of Cuttack against his four brothers, the other partners in the partnership business, praying for a declaration that the partnership stood dissolved since 31-10-40; and in case there be any legal flaw in the dissolution, for dissolving the same under orders of the Court; for taking of account and for the appointment of a Receiver, for granting an injunction against the defendants to prevent obstruction in any way in the works of the plaintiff, for calling upon defendant No. 1 to submit and render accounts and for awarding damages and costs &c.

(2.) A preliminary decree was passed in the suit on 6-8-43 to the effect:

(3.) The only facts stated are in paragraphs 9 and 10 of the statement which are as follows: