Law:

Section:

Section 187, read with Section 188 of the Income-tax Act, 1961 - Firm - Change in constitution of/succession of one firm by another Where on retirement of some of the partners of the assessee-firm, the remaining partners executed a fresh partnership deed along with some new partners, and continued the business after executing a new partnership deed and the Tribunal held that there should be two separate assessments in the case of the assessee : Held that in the new partnership deed, which was executed on 27-8-1980, there was no mention of the old partnership; the books of account had been closed on 26-8-1980, with balance sheet drawn up on the said date; and there was change in the accounting period. The Tribunal had emphasized on the aspect of the change in the accounting period having been accepted by the Assessing Officer. Nothing had been brought on record to dislodge the aforesaid findings of fact. It was apparent from the aforesaid findings that a new contract was entered into on 27-8-1980 incorporating fresh terms, including the change in the accounting period and the same came to be accepted by the Assessing Officer. On behalf of the revenue, there was no evidence pointed out from record that the new contract entered into between the parties, including the change in accounting period, had any relevance to the old partnership. In these circumstances the Tribunal was right in law in holding that there should be two separate assessments in the case of the assessee. CASES REFERRED TO CIT v. Amritlal Nihalchand [1992] 196 ITR 346 (SC) and Addl. CIT v. Harjivandas Hathibhai[1977] 108 ITR 517 (Guj.). Manish R. Bhatt for the Appellant. S.N. Soparkar for the Respondent. JUDGMENT D.A. Mehta J. - The Income-tax Appellate Tribunal, Ahmedabad Bench "B", has referred the following question under section 256(2) of the Income-tax Act, 1961 ("the Act"), at the instance of the Commissioner of Income-tax. "Whether, on the facts and in the circumstances of the case, the Appellate Tribunal is right in law in holding that there should be two separate assessments in the case of the assessee ?" 2. The assessment year is 1981-82. The assessee, a partnership firm came into…

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