Law:

Section:

Section 45 of the Income-tax Act, 1961 - Capital gains - Year in which chargeable - Assessment year 1977-78 - Assessee who represented his HUF as partner in certain firm, contributed capital to it on 4-1-1976, which was treated as transfer within meaning of section 2(47) and for which he claimed that capital gains should be considered in assessment year 1976-77 as he had not maintained any books of account and previous year should be treated as ended on 31-3-1976 and said claim was accepted by Tribunal - Whether, on facts in instant case, there was no infirmity in order of Tribunal and finding of Tribunal was not perverse - Held, yes FACTS The assessee representing HUF was partner in a firm in which he had contributed his capital on 4-1-1976. The Assessing Officer treated that contribution of capital as transfer within meaning of clause (47) of section 2 of the Act and taxed capital gain tax on such transfer. That amount was assessed in the assessment year 1977-78. The assessee claimed that the capital gain should be considered in the assessment year 1976-77, as assessee had not maintained any books of account, the previous year should be treated as year ended on 31-3-1976. The ITO did not accept and taxed the capital gain income in the assessment year 1977-78. On appeal, the Commissioner (Appeals) upheld the view taken by the Assessing Officer. On appeal before the Tribunal, the Tribunal confirmed the view taken by the Assessing Officer that the capital contribution in form of assets in the firm was a transfer, within the meaning of clause (47) of section 2. However, the Tribunal had taken a view that when the assessee had not maintained the books of account, the previous year should be taken as 1975-76, i.e., previous year ended on 31-3-1976. On reference : HELD Considering the admitted facts that the capital contribution had been treated as transfer within the meaning of clause (47) of section 2 and the fact that the assessee had not maintained the books of account prior to the transfer, i.e., on 4-1-1976, it was to be held that there was no infirmity in the order of the Tribunal treating the previous year as 1975-76 when the assets were transferred on…

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