Amount received by partner on retirement is exempt from capital gains tax

Advertisement The issue raised by the Revenue in this appeal is as to whether the amount of Rs 54,59,083/- received by the assessee on retirement from the partnership firm is liable to be taxed as long term capital gain arising on transfer of partnership rights. Hon’ble Supreme court in the case of Mohanbhai Pamabhai (supra) following its judgment in the case of Sunil Siddharthbhai v. CIT 156 ITR 509 (SC) held that when a partner retired from the firm and received his share of an amount calculated on the value of the net partnership assets including goodwill of the firm, there is no trans...