1991 (9) TMI 30

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..... enue, the following two questions of law have been referred for the decision of this court : " 1. Whether, on the facts and in the circumstances of the case and in view of section 43 of the Partnership Act, the Tribunal was justified in law in holding that the dissolution of the partnership was effected only on the date of preliminary judgment, viz., December 19, 1981, and not on December 26, 197 .....

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..... For the assessment year 1979-80, the assessee filed a declaration in Form No. 12 on July 31, 1979. The Income-tax Officer took the view that one of the partners of the firm, one Shri K. G. Damodaran, had filed a suit for dissolution. Summons of the suit was served on one of the partners on December 26, 1978. It is within the previous year relevant to the assessment year 1979-80. The previous year .....

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..... essee-firm had not been dissolved during the accounting period and that registration cannot be refused on the ground that the firm had been dissolved. The firm will continue until it is dissolved by any of the methods known to law. The Appellate Tribunal found that the firm was not dissolved as a matter of fact during the accounting year. In this view, the question of allowing registration for par .....

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..... provided in the Civil Procedure Code. Order 20, rule 15 of the Civil Procedure Code, 1908, provides that the court has to pass preliminary decree which, among other things, will fix a date when the partnership would stand dissolved. In a case where dissolution of the partnership is sought to be done by filing a suit, mere service of summons on a party will not amount to dissolution. In the instant .....

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..... vour of the assessee and against the Revenue. The question whether the firm was genuine is largely one of fact. No material was placed before the Tribunal nor was placed before us which will point out that the firm was not genuine. The Income-tax Officer was not justified in declining to grant registration for the relevant assessment year. We answer question No. 2 against the Revenue and in favou .....

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