Section 187 — the law in short
What the courts have decided on section 187, in one screen. Read this first; open an entry when you need the facts, the reasoning and the source.
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CIT v A.W. Figgies & Co
Supreme CourtHelps taxpayer
Partners have come and gone over the years and a fresh deed was drawn up. Is my firm still the same assessable unit, or has a new firm come into existence?
The same unit. The Supreme Court held that under the Income-tax Act a firm is a distinct assessable entity, separate from the partners who are themselves separately assessable, and that a mere change in the personnel of the partners is not a succession and does not bring a new assessable unit into existence. The business of tea broking had gone on in the same name, at the same place, from before 1918 until the limited company took it over in 1947, with no cesser and no division of assets. The reconstitution in 1945 did not make it a different unit, so the relief for a business charged under the 1918 Act was rightly allowed.
Listed strongest first: Supreme Court, then High Court, then Tribunal, then CBDT. Nothing here has yet been read in full by a chartered accountant — open an entry to see where it came from.