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TMI Blog1979 (7) TMI 2X X X X Extracts X X X X X X X X Extracts X X X X ..... vember 9, 1969, or whether two separate assessments have to be made, One for the period October 22, 1968, to June 30, 1969, and the other for the period July 1, 1969, to November 9, 1969 ? " In order to understand the scope of the question, it is necessary to briefly state the material facts that gave rise to the question. The respondent-assessee was a firm with eleven partners constituted under deed of partnership dated January 27, 1967, whereunder the place of business is stated to be at Ghasmandi Road, Secunderabad, and its accounting year was Diwali year. Three partners had retired with effect from July 1, 1969, and two new partners were admitted. A deed of dissolution of partnership evidencing the retirement of the three partners was ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... made on the aggregate income of the two periods. The Tribunal, by its order dated February 27, 1975, held that on the retirement of some of the partners, the firm stood dissolved by virtue of the dissolution deed and that the case was one of succession governed by section 188 even though some of the partners of the two firms are common and consequently reversed the order of the Additional Commissioner and restored the orders of the Income-tax Officer. Hence, this reference. Sri P. Rama Rao, learned standing counsel for the Income-tax Department, contended that this is a case of only a change of constitution of the partnership as contemplated by section 187(2) of the Act and that the decision in Veeraraghavulu Chetty (T.) Son's case [19 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... decision of this court in Visakha Flour Mills [1977] 108 ITR 466 and Vinayaka Cinema [1977] 110 ITR 468 as well as Nandlal Sohanlal v. CIT [1977] 110 ITR 170 (P H). On a careful consideration of the admitted facts in the present case, we are of the view that the question before us can be answered without relying upon the decision of the earlier or later Full Bench of this court. We, therefore, prefer not to go into the larger question of reconsidering the correctness or otherwise of the Full Bench decision in Vinayaka Cinema [1977] 110 ITR 468 (AP). We may consider that larger legal question as and when it arises directly in any case that may come up before us in future. Where there is only a change in the constitution but not any disso ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... le. In the present case, the original partnership constituted under the deed of partnership executed on January 27, 1967, was in fact found to be dissolved by the Tribunal as a fact. This finding is supported by the execution of a deed of dissolution of the partnership executed on July 9, 1969, with effect from July 1, 1969, and the books of account of the partnership business were made up till June 30, 1969, and the net profits and losses had been ascertained. It also evidences the retirement of the three partners. From July 1, 1969, a new partnership with ten members, i.e., the remaining eight partners of the old firm after the retirement of the three and two new partners who were admitted on July 1, 1969, was constituted and it came in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... m by June 30, 1969, and the new firm had come into existence on July 1, 1969. Each case has to be decided on the facts and circumstances of that particular case and we, therefore, see no legal flaw in the decision of the Tribunal. For the reasons stated, our answer to the question is in favour of the assessee and against the Revenue holding that two separate assessments have to be made, one for the period commencing from October 22, 1968, to June 30, 1969, and the other from July 1, 1969, to November 9, 1969, but not a single assessment, as the provisions of section 188, but not section 187(2), would be applicable to the case on hand. The Department shall pay the costs of the reference to the assessee. Advocate's fee Rs. 300. - ..... X X X X Extracts X X X X X X X X Extracts X X X X
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