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TMI Blog2019 (4) TMI 979X X X X Extracts X X X X X X X X Extracts X X X X ..... nure as a partner of the firm but could not enjoy the fruits thereof on account of the fact that the work having remained incomplete, the concerned client had not been billed for the work already done. In similar circumstances, the courts have held that payment to the partner would amount to diversion of income at source by overriding title. No substantial question of law arises for our consideration. The income tax appeal is dismissed. - Income Tax Appeal No. 273 of 2017 - - - Dated:- 9-4-2019 - Akil Kureshi And Sarang V. Kotwal, JJ. For the Appellant : Mr.Suresh Kumar, Advocate For the Respondent : Mr.Hussain Dholkawala i/b. Ganesh Co., Advocate ORDER P.C. : 1. This Appeal is filed by the revenue to challeng ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Appeal has been filed. 3. Learned Counsel for the revenue fairly pointed out that such an issue had come up before this Court on earlier occasions, where the revenue's Appeals have been dismissed. We may refer to one recent order dated 12/02/2019 passed by this Court in Income Tax Appeal No.1696/16. While dismissing the revenue's Appeal, the Court made following observations; 2. The respondent assessee is a Partnership Firm engaged in providing legal services. During the course of scrutiny of the assessed return for the assessment year 20072008, the Assessing Officer objected to the claimant for deduction of a sum of ₹ 3.68 Crores which was paid by the assessee firm to its retired partner. The assessee pointed out that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the assessee's stand. It appears that the assessee had taken both the grounds namely, that the expenditure was made to discharge the obligation undertaken by the firm as per the relevant clause of the partnership agreement and further that essentially this was a case of diversion of income at source. 4. We notice that similar questions have been considered by this Court on numerous occasions. In case of Commissioner of Incometax v. Mulla and Mulla and Craigie, Blunt and Caroe reported in 190 ITR 198 the concept of diversion of income at source by overriding title was discussed at length under somewhat similar circumstances. The Court made the following observations: In the present case, the assesseefirm was under a legal obl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... this Court in Income Tax Appeal No.860 of 2009 dated 19/6/2009 rendered in the respondentsassessee's own case as well as decision of this Court in the case of CIT vs. Mulla and Mulla and Craigie, Blunt and Caroe, (1991) 190 ITR 198 while dismissing the Revenue's appeal. 5. In view of impugned order of the Tribunal merely following the orders of this Court, we are of the view that the appeal does not raise any substantial question of law. 6. It is not necessary to refer to long line of decisions of this Court and other High Courts taking a similar view in the similar circumstances. Only to summarize, undisputed facts are that the partnership firm envisaged payment to a outgoing partner on the basis that the partner would h ..... X X X X Extracts X X X X X X X X Extracts X X X X
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