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TMI Blog1986 (1) TMI 178X X X X Extracts X X X X X X X X Extracts X X X X ..... rs, two were clearly admitted to the benefits of the partnership only. In respect of another minor, Padmapriya, the deed made no distinction between her and the other adult partners and as per the partnership deed she had an interest of 20 per cent of profit and loss of the firm. The assessee-firm had started their business on 29th Aug., 1978. The books of accounts were closed for the first time o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... she attained majority before the close of the accounting year, she still had time to give her options of whether she would become a partner or not. Her admission as a full-fledged partner when she was a minor was, therefore, not valid and the partnership cannot be registered. 5. The assessee appealed. The assessee is on further appeal before us. Sri M. J. Swamy, appearing for the assessee, subm ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... adampriya became a major. Therefore, it is not possible to say that she had exercised her option of becoming a partner. But, we find that Form No. 11 containing the application for registration was filed on 28th June, 1979 and she has already signed that form like a full-fledged partner. On that date she was a major. Now, this is certainly a positive act by her attesting her desire to be considere ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... an invalidity. Now, in our opinion, it is settled law that profit accrues only on the last day of the accounting year. This is laid down by the Supreme Court in the case of E. D. Sassoon Co. Ltd. vs. CIT (1954) 26 ITR 27 (SC). So, since the profit accrued only on 30th June, 1979, and on that day Padmapriya was a major, there was no question of any minor being saddled with a possible loss which ..... X X X X Extracts X X X X X X X X Extracts X X X X
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