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TMI Blog2000 (2) TMI 63X X X X Extracts X X X X X X X X Extracts X X X X ..... 1961 ? (2) Whether, on the facts and in the circumstances of the case, the Tribunal was right in law in cancelling the order passed by the Commissioner of Income-tax under section 263 of the Income-tax Act, 1961 ? (3) Whether, on the facts and in the circumstances of the case, the Tribunal was right in holding that the Gujarat High Court in the case of Laxmichand Hirjibhai v. CIT [1981] 128 ITR 747 was not applicable to the assessee's case though the assessment of the partners were completed when the Commissioner of Income-tax passed his order ?" The first two questions came to be referred by the Tribunal, at the instance of the Revenue, whereas, the third question has been referred, at the instance of the assessee. As could be s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ditions of the contract between the parties from November 12, 1977, since one of the parties was a minor up to August 8, 1978, and in his view, the minor could not have legally entered into a partnership or agreed to share the losses. In this context, he came to the conclusion that, had the firm incurred any loss during the accounting year the proportionate loss up to August 8, 1978, on which date Sri Gopalbhai became a major could not have been allocated to him under section 30(7) of the Indian Partnership Act, 1932, whereas, a strict application of the partnership deed would have made that possible. In short, it was his view that the fact that actually there was no loss during the year was not a relevant criteria for determining the statu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... for the parties and considering the facts and circumstances and the relevant proposition of law and the case law, as well, we are of the opinion that on the facts and in the circumstances of the case, the Tribunal was right in holding that the decision of this court in Laxmichand Hirjibhai v. CIT [1981] 128 ITR 747 was not applicable to the assessee's case though the assessment of the partners were completed when the Commissioner of Income-tax passed the order. Therefore, question No. 1 is decided in the negative, in favour of the Revenue and against the assessee. Since question No. 2 is corollary and ancillary to question No. 1 in our opinion, it is also required to be decided in consonance with our opinion in respect of question No. 1. ..... X X X X Extracts X X X X X X X X Extracts X X X X
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