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Issues:
Interpretation of section 171(9) of the Income-tax Act, 1961 in relation to partial partition claimed after December 31, 1978 but before April 1, 1980 for the assessment years 1979-80 to 1982-83. Detailed Analysis: The High Court was tasked with determining the applicability of section 171(9) of the Income-tax Act, 1961 to a case where partial partition was claimed after December 31, 1978, but before April 1, 1980, for the assessment years 1979-80 to 1982-83. The Assessing Officer had initially accepted the claim of partial partition made by the assessee in the assessment year 1979-80. However, the Assessing Officer later sought to rectify this decision based on the insertion of sub-section (9) of section 171 by the Finance Act of 1980, which he believed precluded the consideration of partial partition claims made after December 31, 1978. The appellate authority overturned the rectification order, stating that sub-section (9) was not applicable for the assessment year 1979-80, and the Assessing Officer was correct in accepting the claim initially. The Income-tax Tribunal upheld this decision, leading to a reference being made to the High Court by the Revenue. The crux of the issue revolved around the interpretation of sub-section (9) of section 171 of the Act. The Revenue argued that the claim for partial partition made by the assessee after December 31, 1978, could not be considered under sub-section (9). Conversely, the assessee contended that since sub-section (9) was inserted by the Finance Act of 1980 and came into effect from April 1, 1980, the claim made in the assessment year 1979-80 should not be barred by this provision. The assessee relied on the decision of the Supreme Court in Apoorva Shantilal Shah v. CIT, which held that claims made before the assessment year 1980-81 were not affected by sub-section (9). Furthermore, the assessee also cited the decision of the Andhra Pradesh High Court in G. Lakshmi Narayana v. ITO, where it was established that partial partition between January 1, 1979, and March 31, 1979, for the assessment year 1979-80 was not impacted by sub-section (9) of section 171. The High Court found that the present case aligned with the principles laid down in these decisions, supporting the view that the claim for partial partition made by the assessee should not be constrained by the provisions of sub-section (9) of section 171. Consequently, the High Court ruled in favor of the assessee, holding that the claim for partial partition should not be affected by sub-section (9) of section 171 for the assessment years in question. The court directed that there would be no order as to costs and instructed the communication of the order to the Income-tax Appellate Tribunal.
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