1987 (2) TMI 50

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....lowed by the Income-tax Officer for the aforesaid assessment year ? " During the period relevant to the assessment year 1975-76, the assessee entered into an agreement dated October 15, 1973 (annexure E), with certain persons. In terms of that agreement, the business carried on by the assessee was transferred to the second party to the agreement on certain conditions. Two of the conditions alone are relevant for the purpose of this case. They are contained in clauses 6 and 7 which read as under : " 6. The party of the first part hereto further agrees to assist and render such services as may be necessary to retain the agencies and customers and guide the party of the second part from time to time to maximise the business of the party ....

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....h assessment treating the assessee as an association of persons. On appeal by the assessee, the Tribunal held that although the business was transferred, the assessee did not cease to do business, as is clear from the terms of the instrument under which the business was transferred. The Tribunal further held that the amount found to have been received by the assessee represented its business income and that the assessee was entitled to retain the registration. The question is whether the assessee continued as a firm even after the transfer of the business so as to retain its registration under the Income-tax Act, 1961, during the relevant year. Relying upon the decision of the Madras High Court in K. Viswanathan v. Namakchand Gupta, A....