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P. SAM KOSHY, N. TUKARAMJI
Girija Reddy P. – Appellant
Versus
Income Tax Officer – Respondent
JUDGMENT :
P. Sam Koshy, J.
The instant is an appeal preferred by the appellant under Section 260-A of the Income Tax Act, 1961 assailing the order passed by the Income Tax Appellate Tribunal (for short, ‘the Tribunal’) in I.T.A.No.297/Hyd/2012, dated 25.05.2012 (for short, ‘the impugned order’).
2. Heard Mr. C.V. Narsimham, learned counsel for the appellant and Mr.Vijhay K. Punna, learned Senior Standing Counsel for the respondent - Department.
3. Vide the impugned order, the Tribunal partly allowed the appeal and dismissed the stay application filed by the appellant.
4. The brief facts of the case are that the appellant herein was a partner in the firm, viz., M/s.Montage Manufacturers. The appellant stood retired from the said firm w.e.f. 26.12.2007. While retiring from the said firm, the appellant received a sum of Rs..8,22,17,952/- towards her share of capital gain of the firm. However, the respondent-Department held that the right of the appellant in the firm is a capital asset and extinguishment of the right in the said firm stands transferred, and therefore, the receipt against the capital asset is taxable under Section 45 of the Act.
5. Alleging that the appellant has received an
The court established that amounts received by a retiring partner as settlement of their share do not constitute a taxable transfer of capital assets under the Income Tax Act.
Mere reduction in profit-sharing ratio of existing partners upon new partner's admission into firm, without retirement, does not constitute transfer u/s 2(47); amount credited from new contribution n....
Discounts given for prompt payment are legitimate business expenses and cannot be disallowed without corroborating evidence, particularly following a search where no incriminating materials were seiz....
Reassessment – Assets revalued and credit into capital accounts of respective partners can be said to be “transfer”.
The amount received by a partner upon retirement from a partnership firm is not chargeable to tax as income under the Income Tax Act.
A partnership continues despite the retirement of some partners, and remaining partners retain the right to continue business operations.
Dissolution of Partnership Firm – Existence of contract is a sine-qua-non for relationship of partnership – Decision based on adjustment of equities between parties will be far more beneficial than r....
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