9911796707
TMI Blog2001 (1) TMI 68X X X X Extracts X X X X X X X X Extracts X X X X ..... of the amount of Rs. 18,255 representing refund of additional licence fee received from the Excise Department?" The factual position in a nutshell is as follows: The assessee is an individual who was carrying on business under the name and style of Baldev Raj and Sons. Previously Baldev Raj and Sons was the name and style of a partnership firm of which Lal Chand, Kidar Nath, Madho Ram, Bishamber Prashad and B. S. Chawla were the partners. The assessee was the successor to the business which was being carried on by the said firm. The said firm was required to pay certain additional licence fee imposed by the Excise Department during the assessment year 1968-69. Subsequently, a part of the duty was refunded by the Excise Department out of w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 256(2) of the Act, the question as set out above, was directed to be referred. We have heard learned counsel for the Revenue. There is no appearance on behalf of the assessee in spite of the notice. Learned counsel for the Revenue submitted that in view of section 47 of the Indian Partnership Act, 1932 (for short the "Partnership Act"), and section 189 of the Act, mere discontinuance or dissolution would be of no consequence and section 41 of the Act was clearly applicable to the facts of the case. Section 41(1) at the relevant point of time read as follows: "41. Profits chargeable to tax.--(1) Where an allowance or deduction has been made in the assessment for any year in respect of loss, expenditure or trading liability incurred by ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e existence of the aforesaid conditions, the amount has to be brought to tax, irrespective of the question whether the business in respect of which the deduction was allowed is in existence or not. In our view in order to make section 41(1) applicable, it has to be shown by the Revenue that the expenditure was allowed as a deduction in the case of the assessee. The amount in respect of which remission or cessation takes place has to be assessed in the hands of the assessee who was earlier granted an allowance or deduction and none else. The essence of the provision is that the Revenue takes back what has been already allowed, under certain circumstances indicated in section 41, and section 41(1) deals with one of such circumstances. Sub-sec ..... X X X X Extracts X X X X X X X X Extracts X X X X
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