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TMI Blog1977 (11) TMI 53X X X X Extracts X X X X X X X X Extracts X X X X ..... stated : The assessees are the executors of Shri P. L. Paruck, who was a partner in two well-known firms of solicitors. We are concerned in this reference with the assessment year 1958-59, the accounting period being mentioned as 23rd November, 1957, to 31st March, 1958. Actually, Shri Paruck was a partner in two firms, viz., M/s. Mulla Mulla and Craigie Blunt and Caroe and M/s. Mulla and Mulla. Both the firms maintained accounts on the cash basis. Shri Paruck died on 22nd November, 1957, and, therefore, ceased to be a partner in the said two firms from that date. Whilst he was alive he had received Rs. 69,073 from M/s. Mulla and Mulla and Craigie Blunt and Caroe, and Rs. 16,407 from M/s. Mulla and Mulla. This income along with the other ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Appellate Assistant Commissioner accordingly directed deletion of the said amounts. From the decision of the Appellate Assistant Commissioner, the department went in appeal to the Tribunal only for the first assessment year and in respect of the amount of Rs. 71,279 only. The submission of the department was that the share income of Shri Paruck from the said two firms, though received by the executors after the death of Shri Paruck, was received in the previous year in the course of which Shri Paruck died and, therefore, it was taxable in the hands of the assessees. For this, reliance was placed on the decision of the Supreme Court in Commissioner of Income-tax v. Amarchand N. Shroff [1963] 48 ITR 59 (SC) at page 65. The Tribunal rejected t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 105 ITR 764 (Bom), where the effect of section 24B once again came to be considered and there was occasion also for applying the decision of the Supreme Court in Amarchand N.Shroff's case [1963] 48 ITR 59 (SC). In Arvind Bhogilal's case [1976] 105 ITR 764 (Bom), it was observed that section 24B came to be enacted by the income-tax (Second Amendment) Act (18 of 1933) with the avowed object of filling in the lacuna pointed out in the judicial decisions that there was no machinery in the Act till then which dealt with the assessment of or recovering payments from the assets of a deceased person. After considering the statement of objects and reasons appended to the Bill, it was observed that there was no doubt that the provisions of section 2 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ara Prasad Singh [1964] 51 ITR 98, in which independently of the decision of the Bombay High Court in Amarchand N. Shroff's case [1959] 36 ITR 124, it has been observed that where accounts had been maintained on cash basis by an assessee, the share of arrears of rents and royalties falling due during his lifetime but realised after his death which devolves upon his heirs is not stamped with the character of income and was not liable, therefore, to be taxed. In our case also there is a clear finding, which has not been disputed, that the accounts of the firm were maintained on cash basis. As far as this court is concerned, the question appears to have been concluded by the earlier observations in Amarchand N. Shroff's case (of this court) ..... X X X X Extracts X X X X X X X X Extracts X X X X
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