TMI Blog1999 (9) TMI 82X X X X Extracts X X X X X X X X Extracts X X X X ..... ng the value of the goodwill at three times the super profits? 2. Whether, on the facts and in the circumstances of the case, the Income-tax Appellate Tribunal is right in holding that the profits of the firm of the previous year in which the deceased died would not form part of the computation under the super profits method?" The Tribunal has referred the questions along with the statement of facts. The factual background giving rise to the reference is as follows : M. M. N. Durairaja Nadar (hereinafter referred to as the deceased) died on November 4, 1984. During his life time, he was a partner in the firm. "M. M. Nagalinga Nadar and Sons, Quilon". He had a 16 per cent. share in the profits of the firm, which was dealing in coconut ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e average profits on the basis of the five years' average is in order. However, he granted reliefs under some other score. An application for rectification was filed and certain changes were made by order dated January 25, 1989. Aggrieved by the orders of the appellate authority, both against the appellate order and the rectification order, the appeal was filed before the Tribunal. The only objection taken by the accountable person before the Tribunal was regarding the method of computation of the goodwill on the basis of the super profits method. It was contended before the Tribunal that the deceased having died on November 4, 1984, the loss suffered by the firm between the period from August 17, 1984 to August 16, 1985, should have been t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... profits. Ultimately, it was concluded that normally when the goodwill is calculated on the basis of the super profits method, it is calculated by taking a multiple between 3 to 5 times. An application under section 64(1) was filed before the Tribunal, which was not accepted. That is how the application under section 64(2) of the Act was filed in this court. No one appeared in support of the application. We have heard learned counsel appearing for the Revenue. Essentially the conclusions of the Tribunal are factual in nature. What could be the appropriate multiplier to be adopted would depend on the facts and circumstances of each case and no hard and fast rule can be laid down. The Tribunal upheld the application of the three times multi ..... X X X X Extracts X X X X X X X X Extracts X X X X
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