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Section 188 of the income-tax act, 1961-Firm-Registration-Succession of one firm by another firm-Assessee-firm succeeded by a new firm in mid-year after formal dissolution-ITO made two separate assessments for periods before and after dissolution which commissioner cancelled, directing combined assessment-Tribunal set aside commissioner's orders-Whether justified-Held, on facts, yes Facts With the death of one of its partners on 8-8-1971, the assessee-firm was dissolved and a new firm was constituted on 12-8-1971. For the assessment year 1972-73, the assessee filed two returns, one for the pre-dissolution period and the other for the period thereafter. The ITO, accordingly, made two separate assessments. The Commissioner, however, cancelled the assessments and directed the ITO to make a combined assessment under section 187(2). The assessee challenged the order in appeal before the Tribunal. In the meantime, the ITO in pursuance of the Commissioner's direction, passed a fresh assessment order which was, however, set aside by the AAC on appeal. The revenue went in appeal to the Tribunal. Both the appeals were then disposed of by the Tribunal by a common order, holding that separate assessments for the two periods had to be made under section 188. It, accordingly, set aside the Commissioner's order and upheld that of the AAC. On reference: Held Once the old firm was dissolved by the mutual consent of the surviving partners and a new partnership came into existence, the case squarely fell under section 188 and not under section 187(2). The Tribunal's view was, therefore, correct. Case review Dahi Laxmi Dal Factory v. ITO [1976] 103 ITR 517 (FB) (All.), Addl. CIT v. Dilsukh Rai Madho Prasad [1977] 108 ITR 299 (All.) and CIT v. Kunj Behari Shyam Lal [1977] 109 ITR 154 (All.) (FB) followed. Cases referred to CIT v. Kunj Behari Shyam Lal [1977] 109 ITR 154 (All.) (FB), Addl. CIT v. Dilkush Rai Madho Prasad [1977] 108 ITR 299 (All.) and Dahi Laxmi Dal Factory v. ITO [1976] 103 ITR 517 (All.) (FB). Judgment Seth J.-The firm, M/s. Satya Deo Omprakash, was originally constituted under a deed of partnership dated April 2, 1965. One of its partners, namely, Sri Omprakash,…

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