1997 (1) TMI 74 - SC - Income Tax

Summary

Issues involved: Interpretation of the term "transfer" u/s 2(47) of the Income-tax Act in the context of excess amount received by the assessee on retirement from partnership firms.

Summary:

The Supreme Court addressed the appeal by the Revenue challenging the Andhra Pradesh High Court's judgment regarding the assessability of the excess amount received by the assessee on retirement from two partnership firms as capital gains. The High Court's decision was based on the interpretation of the term "transfer" u/s 2(47) of the Income-tax Act. It was noted that according to the Gujarat High Court's judgment in CIT v. Mohanbhai Pamabhai, the retirement of a partner from a partnership does not constitute a transfer of interest in the partnership assets. This interpretation was upheld by the Supreme Court in Addl. CIT v. Mohanbhai Pamabhai. Consequently, the Supreme Court found no merit in the Revenue's appeal and dismissed it, with no order as to costs.