1982 (7) TMI 162

X X   X X   Extracts   X X   X X

→ Full Text of the Document

X X   X X   Extracts   X X   X X

..... s a partner. The ITO taking recourse to the provisions of section 64(1)(vi) of the Income-tax Act, 1961 ('the Act'), added the interest allowed on the gifted amount, in the income of the assessee. He further added her share in the profits of the firm in the income of the assessee. The assessee went in appeal and the AAC confirmed the inclusion of the interest in the hands of the assessee but in re .....

X X   X X   Extracts   X X   X X

→ Full Text of the Document

X X   X X   Extracts   X X   X X

..... v. CIT [1973] 92 ITR 130 (Cal.), Bhaichand Jivraj Muchhala v. CIT [1976] 102 ITR 385 (Bom.) and CIT v. N.K. Pandya [1982] 28 CTR (Bom.) 183 as also the order of the Tribunal in IT Appeal No. 599 (Jp.) of 1978-79, dated 16-1-1979. The departmental representative, on the other hand, contended that as the factum of the lady becoming a partner, was intimately related to the investment of the funds re .....

X X   X X   Extracts   X X   X X

→ Full Text of the Document

X X   X X   Extracts   X X   X X

..... eposit of the gifted amount by the lady has no intimate connection with her becoming a partner in that firm. When the law empowers a person to enter into a contractual agreement like a partnership without investing any capital, I fail to see why this lady could not enter into such an agreement. As I find that the deposit in the firm and the lady's becoming a partner in the firm are not intimately .....

X X   X X   Extracts   X X   X X

→ Full Text of the Document

X X   X X   Extracts   X X   X X