Allowing the appeal of the assessee the Court held that retirement of some partners and induction of new partners and there was no revaluation of assets. Businesses continued accordingly the Court held that the firm reconstituted and not dissolved. Firm is not liable to pay capital gains tax . Order of Tribunal is reversed and order of CIT(A) is affirmed ( AY.2002-03)
G. H. Reddy And Associates v. ACIT (2018) 409 ITR 514 (Mad) (HC) Editorial: SLP of revenue s dismissed ACT v G. H. Reddy And Associates ( 2019) 418 ITR 11 (St)/ ( 2020 ) 274 Taxman 283 (SC)
S. 45(4) : Capital gains – Distribution of capital asset – Dissolution of firm -Change in constitution of firm -Retirement of some partners and induction of new partners — No revaluation of assets — Businesses continued — Firm reconstituted and not dissolved-Not liable to pay capital gains tax . [ S. 45,187(2) ]