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TMI Blog1997 (4) TMI 73X X X X Extracts X X X X X X X X Extracts X X X X ..... at High Court in its judgment dated August 12, 1980 (see [1981] 132 ITR 159), in Income-tax Reference No. 115 of 1975, whereby the following questions referred to it for its opinion by the Income-tax Appellate Tribunal (hereinafter referred to as "the Tribunal') were answered against the Revenue and in favour of the assessee : "1. Whether the Tribunal was right in law in holding that there was succession by inheritance in this case as contemplated by section 78(2) of the Act and, therefore, the assessee is entitled to carry forward and set off the deceased Shri Madhukant M. Mehta's loss in business against the income for these years ? 2. Whether the Tribunal was right in law in holding that section 75(2) of the Act does not prevent the as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ibunal found that there was succession to the business of the deceased on the basis of the following circumstances : "(i) The partnership deed which was drawn up on April 22, 1964, within a month of the death of the deceased, records the fact of the parties thereto as heirs and legal representatives of the deceased, and having succeeded to and carried on the speculation business of the deceased. This claim of the assessee having carried on the speculation business even prior to the date of the partnership deed had not been disputed. Even, if the date of the partnership deed is assumed to be the date from which the business had been carried on under the partnership deed, there was an interval of less than one month between the death of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s brought into existence within about a month of the death of the deceased. The Tribunal has further found that even after the partnership was brought into existence, the business was continued in the same name and in the same premises and the constituents of the assessee's business were the same as those of the business of the deceased. It has been found earlier that during the interval of time between the death of the deceased and the formation of the partnership the outstanding recoveries were effected and the subsisting transactions were cleared and the assets of the business were utilised in clearing the liabilities by the three heirs in the process of carrying on the business as successors." Shri Shukla, learned senior counsel appear ..... X X X X Extracts X X X X X X X X Extracts X X X X
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