9911796707
TMI Blog1980 (3) TMI 134X X X X Extracts X X X X X X X X Extracts X X X X ..... tus of registered firm. The application for registration was also filed separately. The ld. ITO was of the view that Shri Kishan Mohan was given disproportionate share of profit in the business. According to him, the assessee did not produce convincing evidence to show that really the profits were divided in accordance with the profit sharing ratio. So, the ITO held that the firm is not genuine. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d before him. 5. The AAC, after considering the contentions of the assessee, and the comments of the ITO was of the view that the profits were not divided in accordance with the profit sharing ratio, as specified in the partnership deed. Thus, the AAC agreed with the finding of the ITO. 6. Before the Tribunal, on behalf of the assessee, it was contended that the finding of the AAC is not corre ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... There is no evidence on record to show that the profits were enjoyed by any other partner. It was also contended that the firm carried on business in the year of account, in accordance with the clauses of the partnership deed. It was also contended that both the partners employed capital in the business. In the alternative, it was contended that it is not necessary for all the partners to employ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... led Surmal Bahi. This document clearly goes to show that the profits were divided between the partners, in accordance with the profit sharing ratio, and as specified in the partnership deed. The ld. AAC called for the report of the ITO, The ITO gave his comments. He does not say that the Surmal Bahi is a bogus document. Even the AAC does not say so. In view of the aforesaid facts, it is clear that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ordance with the profit sharing ratio. Reference may be made to the decision in the case of K.D. Kamath(1). Looking to the aforesaid facts, in our opinion, the ld. AAC was wrong in confirming the order of the ITO. The firm is a genuine one, and it should be granted registration. The ITO is directed to grant registration to the firm in respect of the asst. yr. 1976-77. 9. In the result, the appea ..... X X X X Extracts X X X X X X X X Extracts X X X X
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