Commissioner of Income-tax Vs. Chuharmal Manghandas - Court Judgment

Excerpt:
- indian penal code, 1890.section 306 :[dalveer bhandari & harjit singh bedi,jj] abetment of suicide deceased, a married woman, committed suicide - allegation of abetment of suicide against appellant husband and in-laws - ocular evidence was sketchy - dying declaration recorded by tahsildar completely exonerated all accused in-laws of any misconduct dispelling any suspicion as to their involvement - letter of threat allegedly written by appellant to father of victim was concocted piece of evidence held, though presumption against appellant can be raised, it cannot be said that onus shifts exclusively and heavily on him to prove his innocence. conviction of appellant is liable to be set aside. - such a conclusion was logical and equitable and would do justice to both the revenue as well as to the assessee.1. this is an application under section 256(1) of the income-tax act, 1961, for calling for a reference and in pursuance of that, this reference was called for by this court and the following question of law has been referred by the tribunal for answer of this court, which reads as under :' whether, on the facts and in the circumstances of the case, the tribunal was right in law in holding that the assessee-firm was entitled to renewal of registration ?'2. the brief facts giving rise to this reference are thus : the assessee is a firm and the assessment year is 1978-79. the assessee-firm, chuharmal manghandas, general merchant, neora, raipur, was constituted by an instrument of partnership dated november 15, 1973, the details of the partners and their respective shares in the profits and losses of the business of the firm were as under :(1)shri lahrumal25 per cent.(2)shri matarmal25 per cent.(3)shri manghandas25 per cent.(4)shri harishchand25 per cent.3. clause 11 of the said instrument of partnership stipulated :' that in case of death of any partner, the firm shall not dissolve but it shall continue for the remaining period of the year with legal representative of the deceased.'4. the assessee-firm submitted its return of income for the assessment year 1978-79 (relevant previous year : diwali, 1977), on june 28, 1978. there was a declaration in form no. 12. during the course of assessment proceedings, the income-tax officer noticed that the said declaration was signed by three partners, viz., s/shri lahrumal, manghandas and harishchand and by one smt. vindharbai, the widow of matarmal, who had died on june 7, 1977. the income-tax officer took the view that the admission of the widow of shri matarmal into partnership on the death of matarmal amounted to a change in the constitution of the firm andthe assessee was not entitled to the benefit of continuation of registration. thereupon the assessee moved the appellate assistant commissioner in appeal and the assessee succeeded in appeal.5. the revenue aggrieved against the order of the appellate assistant commissioner, preferred an appeal before the tribunal and the tribunal dismissed the appeal. therefore, the revenue moved an application under section 256(1) of the income-tax act for calling for the reference. hence, the aforesaid question of law has been referred for answer of this court.6. we have heard learned counsel for the parties and perused the records. apparently, the view taken by the tribunal does not appear to be correct. the tribunal relied on a decision of the allahabad high court given in badri narain kashi prasad v. addl. cit : [1978]115itr858(all) but that decision has already been overruled by the supreme court in wazid ali abid ali v. cit : [1988]169itr761(sc) and not only the full bench decision of this court but that of other courts were considered by their lordships of the supreme court and their lordships held (headnote of air 1988 sc) :' there was a contract to the contrary and the conclusion of the tribunal was correct. the opinion of the high court that there was no warrant for the view of the tribunal was not proper. as a matter of fact, an analysis of the different sections of the act led to the conclusion that there was no contrary provision in the act. such a conclusion was logical and equitable and would do justice to both the revenue as well as to the assessee. true, in the circumstances, the course open was to seek registration, to execute a new deed of partnership and to apply for the registration of that deed. but that does not make the registration up to the date of the death of the deceased partner invalid. income-tax reference no. 163 of 1970, dated february 22, 1972 (all) reversed. girdharilal nannelal v. cit : [1984]147itr529(mp) overruled. on the death of partner and the inclusion of his son there was a change in the constitution of the firm. death did not dissolve the firm but brought about a change in the constitution of the firm.'7. therefore, in view of the ratio laid down by the supreme court, the tribunal has not correctly approached the matter. hence, the view taken by the tribunal, in the present case, is not justified. this reference is answered in favour of the revenue and against the assessee.