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TMI Blog1971 (7) TMI 39X X X X Extracts X X X X X X X X Extracts X X X X ..... e(s) : D. K. MAHAJAN., H. R. SODHI. JUDGMENT The following question of law has been referred by the Income-tax Appellate Tribunal, Chandigarh Bench, for our opinion : " Whether, on the facts and in the circumstances of the case, and particularly in view of the fact that the deed of corrigendum had been executed before the Income-tax Officer passed the impugned orders, the assessee was entitled to registration for the assessment year 1964-65 and continuation thereof for the assessment years 1965-66 and 1966-67 ?" Messrs. Ram Saran Inder Singh, Khanna, a partnership firm, was registered with the income-tax department up to the assessment year 1963-64. It had the following partners : 1. Shri Ram Saran. 2. Shri Inder Singh. 3. S ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... fit sharing ratio was brought in accord with the actual distribution of profits. The deed of corrigendum was duly filed by the assessee with the Income-tax Officer. The Income-tax Officer, thereafter, cancelled the registration for the assessment year 1964-65 under section 186(1) of the 1961 Act. He observed that the deed of corrigendum was drawn up on 7th October, 1966, after the close of the previous year in question and thus did not help the assessee. The Income-tax Officer further disallowed the assessee's claim for continuation of the registration under section 184(7) for the two subsequent assessment years 1965-66 and 1966-67. The assessee then preferred an appeal to the Appellate Assistant Commissioner of Income-tax, who held that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... when he passed the order, the assessee would have no case. We, therefore, agree with the assessee that the firm was entitled to registration as the corrigendum deed had been filed before the Income-tax Officer earlier than the date of order under section 186(1). " As a consequence, the Tribunal further directed that the registration be continued for the two subsequent years 1965-66 and 1966-67. The Commissioner of Income-tax made an application under section 256(1) for referring the question of law, already set out above, for the opinion of this court and the Tribunal by its order dated 8th December, 1970 accordingly, has referred the said question. Mr. Awasthy, learned counsel for the department, has contended that the order of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... more of the persons who were partners of the firm before the change continue as partner or partners after the change ; or (b) where all the partners continue with a change in their respective shares or in the shares of some of them. " This section postulates what is to happen when the constitution of a firm is changed. In the present case, the constitution of the old partnership was changed and the new constitution was evidenced by the new partnership deed. The distribution of profits was not in accordance with the new partnership deed. This led to the cancellation of the partnership deed. The corrigendum which brought the shares in accord with the distribution of profits was furnished on 7th October, 1966. There was no valid partnershi ..... X X X X Extracts X X X X X X X X Extracts X X X X
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