1994 (1) TMI 76

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..... he Tribunal was right in holding that the two firms are not independent and the building belonged to the appellant-firm ?" The assessee is a firm dealing in cloth. During the assessment year in question, a theatre known as Balamani Theatre was constructed at cost of Rs. 2,40,000. The assessee claimed that the theatre belongs to separate partnership firm constituted under a deed dated April 15, 19 .....

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..... ion. There is interlacing of funds and the accounts indicated that the funds of the cloth business alone were utilised for the construction of the theatre. In the firm's books the theatre building had been shown as the investment of the firm. It also appears on the assets side of the balance-sheet of the assessee during the assessment year 1975-76." On the basis of this finding, the Tribunal held .....

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..... rships and, therefore, two distinct firms, or to extend merely a partnership originally constituted to carry on one business, to the carrying on of another business. It will all depend on the intention of the partners. The intention of the partners will have to be decided with reference to the terms of the agreement and all the surrounding circumstances, including evidence as to the interlacing or .....

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