1968 (10) TMI 19 - HC - Income Tax

Assessee firm was refused registration on the ground that the deed specified only shares in the profits and not in the losses - refusal of registration to the firm was not proper

Summary

The High Court of Karnataka ruled in favor of the assessee, a firm in Hubli, in a reference under section 66(1) of the Indian Income-tax Act, 1922. The court held that it is not necessary for a firm's instrument of partnership to specify the shares of partners in losses to obtain registration under the Act. The court cited a previous decision to support its ruling. The Income-tax Officer erred in refusing registration, and the Appellate Tribunal was wrong in upholding the decision. The court awarded costs to the assessee.