9911796707
TMI Blog1978 (8) TMI 107X X X X Extracts X X X X X X X X Extracts X X X X ..... taken as partners. The assessee's share was divided between these two minors. They had made a contribution to the partnership by way of capital amounting to Rs. 3,000 each. 2. The GTO by his order dt. 28th Sept., 1973 held that there was a taxable gift in so far as the relinquishment of the assessee's right to share the profits in favour of the three continuing partners. The assessment year was the year 1971-72. The assessee appealed therefrom. Before the AAC he pointed out that he retired w.e.f. 16th August, 1969 and therefore the correct assessment year should be 1970-71 and there could be no assessment for 1971-72. This submission was accepted by the AAC. The AAC's decision was also accepted by the Department. Therefore the assessment ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sessee, submitted that there could be no gift assessable in respect of the future profits as assumed by the AAC. We accept this submission and this is supported by the decision of the Madras High Court in 110 ITR 212. So the order of the AAC would not stand on the fact of this authority. When the assessee had retired from the partnership, he has no claim for any future profits of the partnership. He has no right therein. He cannot therefore make a gift of that. However, the GTO has not rested his case entirely on the future profits alone. We have give an extract from the assessment order. The GTO has held that the gifted asset was the goodwill or the right to share the profits. In so far as there could be a goodwill of the firm it could not ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is appeal. We think, in the interest of justice, the matter will have to be referred back to the AAC for disposing of this point. 5. It was submitted by Mr. Venkataraman that the assessment was barred by limitation. In para 7 of the grounds of appeal he had set out the reasons. The main ground appears to be that it was really assessable for the asst. yr. 1971-72. We do not think that the assessee can raise this point before us since his ground before the AAC for the proceedings of 1971-72 was specifically against what is being submitted now. Therein he had contended successfully that the correct asst. yr. was 1970-71. With regard to the re-assessment for the year 1970-71 the assessee cannot successfully resist the validity of the reopenin ..... X X X X Extracts X X X X X X X X Extracts X X X X
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