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TMI Blog1985 (12) TMI 121X X X X Extracts X X X X X X X X Extracts X X X X ..... sentative. 3. The facts are that the assessee was the sole owner of a business carried on in the name of Central India Dairy Creamery, Bhopal. From 16th Jan., 1979 the assessee converted this business into a partnership firm taking his two sons Kishore Gupta and Anil Gupta, as partners. The assessee owned certain machinery and vehicles which were used in the said business. These items we revea ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rder. 4. At the hearing before us, the learned counsel for the assessee relied upon a recent ruling from the Hon ble Supreme Court of India in Sunil Siddharthbhai vs. CIT (1985) 49 CTR 172 : (1985) 156 ITR 509 (SC) in which it has been held that in the circumstances like those mentioned above, although there is a transfer of assets, no capital gain arises because no actual consideration is recei ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ner in his personal asset is, upon its introduction into the partnership firm as his share to the partnership capital, transformed into a shared interest with the other partners in that asset. Qua that asset, there is a shared interest. During the subsistence of the partnership the value of the interest of each partner qua that asset cannot be isolated or carved out from the value of the partner s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... personal asset merges into the capital of the partnership firm a corresponding credit entry is made in the partner s capital account in the books of the partnership firm, but that entry is made merely for the purpose of adjusting the right of the partners inter se when the partnership is dissolved or the partner retires. It evidences no debt due by the firm to the partner. Indeed, the capital repr ..... X X X X Extracts X X X X X X X X Extracts X X X X
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