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TMI Blog1979 (9) TMI 105X X X X Extracts X X X X X X X X Extracts X X X X ..... l income of Rs. 1,47,302. In that assessment, income for both the periods was clubbed. Against that order, the assessee went in appeal. The ld. AAC vide his order dt. 20th Dec., 1976 set aside the said order. He directed the ITO to complete fresh assessment in accordance with the law, and also on the directions given by the ld. AAC. 3. The ld. ITO found that after the death of Shri Hassanand on 7th Nov., 1973 the firm consisting of six partners, namely, Shri Hassanand, Shri Kodumal, Shri Gopal dass, Shri Lalchand, Shri Naraindass and Smt. Bagi Bai was not dissolved. In his opinion, after the death of Shri Hassanand, new partners were taken, and the business continued as usual. According to the ld. ITO, it was a case of change in the const ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he partners that after the death of a partner, the firm will not be dissolved. In his opinion, the old firm came into existence in 1958, and the same firm continued till the end of the accounting period. In his opinion there was change in the constitution of the firm. Thus, the ld. CIT of (Appeals) agreed with the finding of the ld. ITO. 6. Before the Tribunal, the ld. counsel for the assessee submitted that the findings of the ld. CIT (Appeals) is incorrect. In the old firm, there were six partners, including Shri Hassanand. The partnership deed dt. 26th Dec., 1970 no where stated that after the death of a partner, the firm shall not be dissolved. According to the ld. counsel there was no contract to the contrary as provided in s. 42(c) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er of fact, the new firm is succeeded by the old firm, and as such, the present case is covered under s. 188 of the Act. Reliance was placed on the decision of the Full Bench of Hon'ble Andhra Pradesh High Court in the case of Addl. CIT vs. Vinayaka Cinema(1), Kaithari Lungi Stores vs. CIT(2), Dahi Laxmi Dal Factory vs. ITO(3), and Addl. CIT vs. Harijivandas Hathibhai.(4) 7. The ld. Deptl. Representative supported the order of the ld. CIT (Appeals) and submitted that the present case is covered by the decision in the case of Nandlal Sohanlal vs. CIT(5) 8. We have heard the parties and perused the entire evidence on record. From the facts, as emerge from the records, it is clear that the old firm consisted of six partners, namely, Shri H ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ss was formerly carried on by six partners, namely, S/Shri Hassanand, Kodumal, Gopaldass, Lalchand, Naraindass and Smt. Bagi Bai, and now, due to death of Shri Hassanand, the old partnership has dissolved and now with the joining of two new partners, namely, Smt. Mohinibai and Shri Jaichand, this new deed is being executed. Smt. Mohini Bai has been taken as a partner in place of her late husband Shri Bagumalji who was founder partner of this firm, and so also Jaichand has been taken as a partner on account of death of his father Shri Hassanandji". According to the ld. counsel, w.e.f. 10th Nov., 1973, new books started in respect of the new firm. At the close of the accounting year, the books were closed and the accounts were settled in ac ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r is on the paper book. The new firm also filed in Form No. A under the Indian Partnership Act on 13th Dec., 1973. The copy of the same is also on the paper book. From this Form also it is clear that the old firm was dissolved as a result of the death of a partner, and a new firm came into existence w.e.f. 10th Nov., 1973. The new firm also applied for registration to the Register of firms and registration was granted to the firm. The ld. ITO also completed the assessment in the status of Registered Firm. As stated above, after the death of a partner, namely, Shri Hassanand, the remaining partners sent a letter to the Bank stating that after the death of a partner, the account of the firm shall be operated upon by the remaining partners unt ..... X X X X Extracts X X X X X X X X Extracts X X X X
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