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TMI Blog1981 (9) TMI 152X X X X Extracts X X X X X X X X Extracts X X X X ..... purpose of working out depreciation in respect of machineries was Rs. 7,21,800. The facts of the case are as follows. The assessee is a private limited company. This company was a partner in a firm. The other partners were individuals. These individuals, however, were the directors in the assessee-company. The firm had certain fixed assets in building, plant and machinery. The books of the firm sh ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is figure and the excess over the book figure of Rs. 3,55,374 was transferred to the capital account of the partners according to their profit sharing ratio. The capital accounts of the partners were increased by Rs. 3,66,425. 3. The limited company allotted to the retiring partners 3,000 equity shares of Rs.100 each and the amount of balance standing to their credit in respective capital accou ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... iation on the written down value of the plant and machinery as reflected in the income-tax records of the dissolved firm. 5. The CIT(A), however, accepted the assessee's contentions. The Department is on appeal before us. The assessee's case is completely covered by a decision of the Supreme Court in Kaluram Govindram vs. CIT (1965) 57 ITR 335 (SC). In that case, a joint family was the owner of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... at the time of partition. We are of opinion that this principle is clearly applicable not only in the case of partition of a joint family but also in the case of dissolution of a firm. In both, the rights and liabilities of the members of the association are being determined. In this case, the enhanced value of the asset taken by one partner has been the basis for determining the rights of the ret ..... X X X X Extracts X X X X X X X X Extracts X X X X
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