9911796707
TMI Blog2001 (11) TMI 11X X X X Extracts X X X X X X X X Extracts X X X X ..... t of harmonious consideration of section 42 of the Indian Partnership Act and section 187 of the Income-tax Act, but the question is to the effect that as to the existence of the supplementary partnership deed. It is a purely a question of fact which has been answered against the assessee - - - - - Dated:- 5-11-2001 - Judge(s) : N. N. MATHUR., O. P. BISHNOI. JUDGMENT The judgment of the court was delivered by N.N. MATHUR J.-This reference application under section 256(2) of the Income-tax Act, 1961, has been filed at the instance of the assessee seeking reference on the following questions of law for the opinion of this court: "1. Whether, the learned Tribunal was right in law in holding that the notice under section 148 dated J ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Act. Subsequently, it transpired that the assessee had overvalued the closing stock in the first return so as to take benefit of the same in the second return. In the first return, the assessee had declared an income of Rs. 8,350 after inflating the value of stocks, by a sum of Rs. 9,05,184, but for this overvaluation of closing stock, there would have been a loss of Rs. 8,96,834. Thus, according to the Revenue, by overvaluation of the closing stock for the first period, the assessee suppressed the profits of the firm in the second period so as to get a dual benefit. Accordingly, the proceedings were reopened by issuing a notice under section 148 of the Income-tax Act to the assessee for the period August 25, 1986, to March 31, 1987. On Aug ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is contended by Mr. Kothari, learned counsel for the assessee, that upon the death of the partner, there was only change in the constitution of the partnership firm and not dissolution. He has pointed out certain circumstances to show that a supplementary deed was executed which provides that on the death of the partner, the firm shall not be dissolved. It is pointed out that Smt. Rajrani, the widow of the late Shri Pyarelal, was substituted as a partner and the partnership firm continued to exist thereafter. It is submitted that two returns were filed under a bona fide mistake. However, when the partners came to know about the correct interpretation of the provisions of law, they immediately filed a revised return before the assessing auth ..... X X X X Extracts X X X X X X X X Extracts X X X X
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