Ajit K. Sengupta, J. - (1.) At the instance of the Commissioner of Wealth-tax, the Tribunal has referred the following question of law to this court, for the assessment years 1976-77 and 1977-78, under Section 27(1) of the W.T. Act, 1957: "Whether, on the facts and in the circumstances of the case, the assessee is entitled to deduction under Section 5(1)(iv) of the Wealth-tax Act, 1957, in respect of property belonging to the firm ?"
(2.) The facts in brief are stated hereunder : The assessee is a partner in a partnership firm. The partners originally were the members of the same family. The house property in which the partners were residing was owned by the partners. It was treated as the property of the firm which is carrying on business. In the wealth-tax assessment of the assessee, exemption was claimed in respect of the said house property on the ground that the assessee had been residing there even though the property formed a part of the assets of the partnership firm. The justification for making such a claim is that the property continued to belong to the assessee inasmuch as the partnership is nothing but a compendious name for a group of persons joining together for carrying on business and the property continued to belong to the partners.
(3.) The WTO denied the exemption on the ground that the property did not belong to the assessee any longer but in fact belonged to the partnership firm.;