1970 (7) TMI 23

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....section 256(1) of the Income-tax Act, 1961, made at the instance of the assessee. The question of law referred for our opinion is : "Whether, on the facts and in the circumstances of the case, and the provisions of the Partnership Act, the sum of Rs. 50,000 was properly assessable in the previous year relevant for the assessment year 1962-63 ?" The material facts as found by the Tribunal so ....

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.... to interest at the rate of 6 per cent. per annum on the amount of the said J. B. Pinto's share in the properties of the other two firms. Disputes arose between the assessee on the one hand and the surviving partners of the said five firms on the other. The dispute ultimately ended in a settlement under which the assessee executed a release deed dated June 21, 1961, whereby a sum of Rs. 5,76,582 w....

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....essment years 1959-60 and 1960-61, since the assessee followed the mercantile system of accounting. The Appellate Assistant Commissioner and also the Tribunal have rejected that contention and assessed the assessee on the receipt basis which was during the relevant previous year to the assessment year 1962-63. In the assessment order made by the Income-tax Officer, it is shown that the method o....

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....nts due at 5 per cent per annum. In regard to the remaining two firms, by virtue of section 37 of the Indian Partnership Act, the legal heirs of the deceased became entitled to interest at 6 per cent. on the amount of the deceased's share in the properties of the firms. Therefore, by virtue of the statute and also by virtue of the terms of the partnership deeds, the assessee became entitled to int....