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TMI Blog1983 (6) TMI 63X X X X Extracts X X X X X X X X Extracts X X X X ..... share in the value of 40% share of HUF in M/s Aero Engg. Works. The assessee in its cross objection has disputed the action of the AAC denying exemption to her u/s 5(1)(xxxii) and 5(1)(iv) of the WT Act, besides disputing the valuation of shares held by the assessee in M/s Aero International Exports (P) Ltd. 2. In order to appreciate all these contentions one by one and adjudicate the respective the respective issues raised by the two parties, it is necessary to state the facts in brief. One Sohan Lal, i.e. husband of the assessee, constituted an HUF of himself his wife Kamla Wati the assessee, and their minor son Anil Kumar. The said HUF had income from house property beside having 40% share in M/s Aero Engg. Works through Sohan Lal Kar ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n M/s Aero Engg. Works be recomputed. The deletion of Rs. 33,622 and direction of the AAC for recomputing the share aggrieved the revenue whereas denial of exemption u/s 5(1)(xxxii) and enhancement of valuation of shares in M/s Aero International Exports (P) Ltd. Left the assessee also felt aggrieved. The assessee also felt aggrieved regarding the action of the AAC in not granting exemption u/s 5(1)(iv) in respect of 1/3 rd share of 40% held by the family in the said firm on account of land and building of the said firm and in that regard too, he raised a ground in her cross objection. 4. The ld. Departmental representative Mr. C.L. Jain submitted that since the assessee was not a partner in the firm, exemption u/s 5(1)(xxxii) of 5(1) (i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... i.e., Sohan Lal, for the asst. yr. 1975-76, all the contentions raised by the assessee in her cross objection and assessee's contentions the revenue's appeal have been accepted. The exemption has been granted in respect of s. 5(1A). He came forward with certain documents which were relevant to the issues, i.e., statement of the assessee's wealth for asst. yr. 1973-74 showing 1/3rd of 40% share and exemption claimed u/s 5(1)(xxxii) and 5(1)(iv), which according to him has been allowed by the revenue for the said year and he filed a copy of assessment order in the assessee's case for asst. yr. 1973-74. He also similarly field the assessee's statement of wealth for asst. yr. 1977-78, which was accepted Regarding s. 5(1)(iv) claim, he submitted ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ment by which individual's overriding titles we created by Sh. Sohan Lal, Smt. Kamla Wati and Anil Kumar in respect of Sh. Sohan Lal's share in the firm. There being no privity of contract, the theory of sub-partnership flowing from the partial partition agreement cannot be accepted. Keeping in view the facts and the pattern of assessment followed by the ITO in our considered view, there was no justification for departure and in view of the Hon'ble Punjab High Court Judgement in the case of Ram Narayan's case, the action of the ITO is considered as wholly wrong and unjustified." On the basis of above finding, the addition of Rs. 33,622 made in the hands of the assessee on account of earlier years additions which ought to have accepted is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and send back the matter to the file of the WTO with a direction to allow exemption to the assessee u/s 5(1)(iv) and 5(1)(xxxii) in respect of her 1/3rd share held in 40% in M/s Aero Engg. Works. He is directed to recompute the value of the assessee's 1/3rd share in the value of 40% share of HUF in M/s Aero Engg. Work as for observation made by the AAC in paras 7 and 8 of this order. He is also directed to include 1/3rd share in 40% of the addition of Rs. 2,52,164 made in the case of M/s Aero Engg. Works in earlier years after verifying its correctness. 9. Reliance of the ld. departmental representative on the two above referred cases, is misplaced because of distinction in facts. These were the cases where sub-partnership were brought i ..... X X X X Extracts X X X X X X X X Extracts X X X X
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