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2017 (8) TMI 1385 - KERALA HIGH COURTExigibility to tax under section 4 of the Gift-tax Act, 1958 - gift-tax on surrender of share on a reconstitution of the firm - transfer of shares effected by some partners of the firm in favour of a newly inducted partner, virtually suffering a reduction in the share of profit simultaneously facilitating extension/increase of profits to the incoming partner by itself - sufficient consideration for the purpose of the exemption - Held that:- Reduction of shares at the hands of the assessee at the time of reconstitution of the firm, to the extent the same has been transferred in favour of the newly inducted partners, is for adequate consideration and that it is not a "gift" in terms of section 4(1)(a) of the Gift- tax Act so as to suffer any tax liability. Answering the question as above, the matter is remitted to the Tribunal in terms of section 26(6) of the Act for further steps.
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