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Section 256(2) of the income-tax act, 1961-Reference to high court-Question of law-V, karta of assessee-HUF, was partner in firm h and his income therefrom was assessed in HUF's hands-V ceased to be partner in H on 31-5-1969, but his HUF continued to carry on the same business under different name-For assessment year 1971-72, assesses HUF claimed set off of V's share in the loss incurred by H up to 31-5-1969-ITO disallowed claim but AAC and tribunal allowed it-Whether any question of law arose from tribunal's order-Held, on facts, no Facts The assessee was a HUF whose karta, V, was partner in a firm H. V's share income from the said firm was being assessed in the hands of the assessee-HUF. V ceased to be a partner of H from 31-5-1969, but the HUF continued to carry on the same business under a different' name M. For the assessment year 1971-72, the firm H suffered a loss and V's share in the said loss up to 31 5-1969 was included by the assessee HUF in its return of income, claiming a set off of the same. The ITO rejected the claim on the ground that V had ceased to be a partner of H. However, both the AAC and the Tribunal allowed the claim and the Tribunal also rejected the revenue's application under section 256(1). On application under section 256(2): Held Two basic facts emerging from the case were that V had ceased to be a partner in the firm H on 31-5-1969 and that he had claimed a set off only in respect of his share in the loss incurred during the period when he was a partner in the said firm. Even when he was a partner in H, his share of income therefrom was assessed in the hands of the HUF. Subsequently, the HUF continued to run the same business under a different name. In such circumstances, the relief available under section 72(1) in regard to the set off of the loss could certainly be claimed by the assessee. The Tribunal had also correctly held that the fact as to whether V had continued to carry on the business in the next assessment year was a pure finding of fact and no question of law arose therefrom. Thus, the Tribunal was quite correct in refusing to refer question to the High Court. Judgment Surinder Singh, J.-The prayer made in this…

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