Topic
ITAT Delhi rules that contractual receipts and interest credited to a surviving partner's proprietorship after firm dissolution cannot be taxed in the dissolved firm's hands, preventing double taxation. The tribunal emphasized substance over form, directing tax liability to follow the actual recipient of income.
The Bombay High Court upheld an arbitral award of Rs. 7.39 crores to a partner whose financial records were deliberately withheld by the co-partner, ruling that such obstruction forfeits the right to contest the award’s computation method. The judgment establishes that limitation in partnership dissolution begins at dissolution, not profit accrual, and deliberate non-cooperation undermines procedural fairness in arbitration.
Bombay High Court affirms that under Section 37 of the Indian Partnership Act, heirs of a deceased partner retain entitlement to post-death profits if the partnership deed's buyout clause is not duly executed. The ruling reinforces that contractual obligations must be strictly complied with to extinguish profit-sharing rights of legal heirs.
Madras High Court upholds conviction under Section 138 NI Act, ruling that cheques issued post-partnership dissolution retain statutory presumption of liability if they discharge a pre-existing debt. The Court affirmed compensation of Rs. 16.72 lakh, ordering 50% release to the complainant, reinforcing that unregistered dissolution documents do not invalidate the debt.