1996 (3) TMI 19

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....re partners in the same firm, the Tribunal referred the following question of law, relating to the asst. yr. 1978-79, under s. 256(1) of the IT Act, 1961, for the opinion of this Court : "Whether, in the case of a partner of a firm, which had become defunct, the Tribunal is correct in law in coming to the conclusion that the unabsorbed depreciation relating to the defunct firm which had closed ....

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.... been closed, the carried forward loss relating to it cannot be set off. The assessee preferred an appeal before the AAC and contended that the assessees are partners in a number of firms, and the business of all these firms forms but one business and so long as one of these businesses exists, the carried forward loss of a defunct firm should be allowed to be set off against other business income ....

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....efunct. 4. A similar question came up for consideration before the Supreme Court in the case of CIT vs. Virmani Industries (P) Ltd. (1995) 129 CTR (SC) 189 : (1995) 216 ITR 607 (SC) wherein the Supreme Court while considering the set off of unabsorbed depreciation under s. 32(2) of the Act held as under : "The next question is whether for availing of the benefit of s. 32(2), is it necessary ....