9911796707
TMI Blog1977 (12) TMI 43X X X X Extracts X X X X X X X X Extracts X X X X ..... late Suraj Mal, his widow Smt. Radha Devi was taken as a partner. There was a change in the constitution of the firm and there were two accounting periods of the previous year one from 7th April, 1970 to 12th Feb., 1970 and the second from 3rd Dec., 1970 to 31st March, 1971. The return of income was due to be filed on or before 30th Sept., 1971. The assessee filed the return on 24th Dec., 1971 disclosing an income of Rs. 46,150 for the first period. No voluntary return was filed for the second period and a notice under s. 148 was issued on 5th Aug., 1972. The return for the second period was filed on 1st Sept., 1972 declaring income of Rs. 1,09,226. Though the assessee claimed that two separate assessments should be made, the ITO made only ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... od was not a complete return because the income for the second period had not been taken into consideration in that return. The return for the second period came to be filed on 1st Sept., 1972 and that too after a notice under s. 148 was issued and that was the date taken for filing the due return in this case. The ITO was not satisfied that the disputes amongst the partners constituted a reasonable cause in this case. He called this contention as of-repeated and common place because such a contention was advanced by most of the assessee for explaining the delay. The delay of 10 months was held to be without reasonable cause and penalty of Rs. 20,937 was levied under s. 271(1)(a). 4. Being aggrieved, the assessee filed an appeal to the A ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n given by the AAC for calculating the penalty on the basis of the tax on the income only for the second period is wrong. 5. We have heard both the parties and have considered their rival contentions. We would first consider the assessee's plea of a reasonable cause for the delay. For establishing a reasonable cause for the delay, the learned counsel for the assessee had submitted that there were disputes between the two groups of partners and the firm was agreed to be dissolved w.e.f. Chet B. 15, S.Y. 2027 by dissolution deed dt. 19th Aug., 1970. Suraj Mal's group was to take over the business of the firm and Lila Dhar's group comprising 7 partners was to retire. After the agreement of dissolution, Suraj Mal died on 2nd Dec., 1970. The ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e referred to Gulab Singh Jain, Advocate. The partnership possessed land measuring 4100 sq. yards for which a map was prepared and the shaded portion in the map was to go to the retiring partners and the un-shaded portion in the map was to become the property of the continuing partners. The retiring partners had agree to pay a sum of Rs. 24,027 to the continuing partners for the land falling to their share. A balance sheet as on Chet B. 15, S.Y. 2027 had to be prepared. The continuing partners were not to carry on business in the name of Nand Ram Daulat Ram but were to carry on the business under name and style Dulat Ram Suraj Mal and the retiring partners were not to carry on salt petre business under the present name of the firm. There ar ..... X X X X Extracts X X X X X X X X Extracts X X X X
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