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TMI Blog1975 (11) TMI 58X X X X Extracts X X X X X X X X Extracts X X X X ..... emaining four partners and four other persons executed a new deed of partnership dt.15th Dec., 1969to carry on the business under the name and style of R.C. Chemicals. To the benefits of this partnership five minors were admitted. The business of the new firm was stated to have commenced from1st July, 1969. The assessee therefore, filed two returns of income, one for the period from1st April, 1969to30th June, 1969and the other for the period from1st July, 1969to31st March, 1970. It was claimed before the ITO that two separate assessments should be made on the two different firms for these two periods. The ITO, however, clubbed the income of both the periods and made one assessment. 2. The assessee preferred an appeal to the AAC objecting ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nd the income of that firm could not be clubbed with the income for the erstwhile firm. In support of this submission reliance was placed on the two Full Bench decision of the Allahabad High Court in Dhai Laxmi Dal Fatory vs. ITO 1974 U.P.T.C. 630 and CIT vs. Kunj Behari Shyam Lal 1975 U.P.T.C. 8. 4. On behalf of the Department it was submitted that the decision of the Supreme Court in the case of Shivram Poodar makes it clear that where a firm is dissolved but the business is not discontinued, there is a change in the constitution of the firm and since in the present case the same business was carried on with a new constitution of the firm, it was also a change in the constitution and one assessment was justified. Reliance was also place ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nch has held that there the new firm comes into existence after the dissolution of a firm such a case would not be covered by s. 187 and it would be a case of a new firm succeeding the old firm requiring two assessment to be made under s. 188 of the Act. In the present case the old firm was dissolved by a dissolved by a dissolution deed dt.30th July, 1969and a new firm came into existence under a fresh deed dt.1st July, 1969, the constitutions of the two firms were entirely different. There were only a few common partners but four new partners joined and five minors were admitted to the benefits of the new partnership. On these facts there is no doubt that the new firm came into existence after the dissolution of the old firm and these two ..... X X X X Extracts X X X X X X X X Extracts X X X X
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