1985 (12) TMI 121

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.... 2. We have heard the ld. counsel for the assessee and the ld. Departmental Representative. 3. The facts are that the assessee was the sole owner of a business carried on in the name of Central India Dairy & Creamery, Bhopal. From 16th Jan., 1979 the assessee converted this business into a partnership firm taking his two sons Kishore Gupta and Anil Gupta, as partners. The assessee owned certain....

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....the ground that there is extinguishment of right in such assets, as perfectly in order. 4. At the hearing before us, the learned counsel for the assessee relied upon a recent ruling from the Hon'ble Supreme Court of India in Sunil Siddharthbhai vs. CIT (1985) 49 CTR 172 : (1985) 156 ITR 509 (SC) in which it has been held that in the circumstances like those mentioned above, although there is a ....

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....upon his retirement from it. "Therefore, what was the exclusive interest of a partner in his personal asset is, upon its introduction into the partnership firm as his share to the partnership capital, transformed into a shared interest with the other partners in that asset. Qua that asset, there is a shared interest. During the subsistence of the partnership the value of the interest of each pa....

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....issolution or retirement after a deduction of liabilities and prior charges. When his personal asset merges into the capital of the partnership firm a corresponding credit entry is made in the partner's capital account in the books of the partnership firm, but that entry is made merely for the purpose of adjusting the right of the partners inter se when the partnership is dissolved or the partner ....