The assessee appealed and the Appellate Assistant Commissioner upheld the assessees companytention that thera was numbervoluntary act by him and that he had only relinquisred his right and interest in the firms so that here was up gift.
1972 from two firms in which he was a partner.
Before the Tribunal it was urged on behalf of the Revenue that the amounts taken by the assessee from the firms for rns shares therein was less than the market value thereof since the goodwill of he firm had number been taken into account.
The Revenue is in appeal by special leave.
There had, therefore, been a relinquishment of his shares, which was a gift.
The Tribunal took the view that on retirement, the retiring partner was only entitled to get the value of his share in the partnership assets less Maoi ilties, it was, therefore, merely an adjustment of rights between the retiring partner and the companytinuing partners in the assets of the partnership and there was numberelement of transfer of interest by the retiring partner to the companytinuing partners.
The assessee retired with effect from 1st April.
The assessment year with which we are companycerned is the Assessment Year 1973 74.
The Gift Tax Officer assessed him to gift tax on the basis that, upon such retirement, there was a gift because the assessee had surrendered his rights in the firms.
LITTTTTTJ JUDGMENT Bharuch,aJ,J. The High Court of Kerala answered in the atlirmative and against the Revenue the following question Whether, on the facts and in the circumstances of the case, the Tribunal was right in holding that numberelement of gift was involved when the assessee retired from the firms in which he had been a partner?
