9911796707
TMI Blog1960 (2) TMI 66X X X X Extracts X X X X X X X X Extracts X X X X ..... basis. Subsequently the assessee made a claim that the business had been taken over by a firm consisting of himself and four others, namely (1) Adala Ramireddy of Nellore, (2) Bettepati Subbareddy of Nellore, (3) Veluru Saraswathama of Indupur, Kovur Taluk, and (4) Kotamreddi Chenchamma of Bodduvaripalem, Kovur Taluk. It was alleged that there was a partnership deed dated 15-8-1950, and registration of the firm was claimed on the basis of this partnership deed under Section 26A of the Indian Income Tax Act. The application for registration was rejected by the Income Tax Officer and assessment was made under Section 23(3) of the Income Tax Act on the basis that the firm was an unregistered firm. The matter, was taken up in appeal, but th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ica Act, if the business of the partnership was to deal in mica, and in the absence of any such licence having been granted to the partner ship it must be held; that the object of the partner ship was unlawful and registration had been, rightly refused by the Income Tax authorities. We do not accept this argument as right. Section 4(1) (d) of the Bihar Mica Act is to the following effect. 4. (1) Save as provided in Sub-section (2) and Sub-section (3) of this section, no person shall: x x x x x (b) buy mica, or have in his possession or sell mica extracted in a controlled area from a mica mine or mica dump of which he is not in possession or, mica imported into a controlled area from any place not situated in a controlled ar ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on, only a compendious mode of designating the persons wild have agreed to carry on the business of partnership. According to the principles of English law which we have adopted in India for the purposes of determining legal rights there is no such thing as a firm known to the law as was said by James L.J. in Ex parte Corbett: In re Shand (1880) 14 Ch. 122. We, therefore, reject the argument of the learned Standing Counsel on this part of the case and hold that a firm as such is not required to take out a dealer's licence under Section 4(1) (d) of the Bihar Mica Act, 1947. 3. It was next submitted by the learned Standing Counsel that Section 7 of the Act required that no person whose name is not endorsed on a dealer's licence o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rovided of course that the person who actually sells and who actually purchases and who actually is in possession of the mica has the dealer's licence required under Section 4(1) (d) of the Act. We, therefore, hold that the view taken by the Income Tax Appellate Tribunal in this case is legally correct and it must be held that the partnership is legally valid and is entitled to be registered under Section 26A of the Indian Income Tax Act. We accordingly answer the question of law referred to the High Court in favour of the assessee and against the Income Tax Department. There will be; no order as to costs. 4. Miscellaneous Judicial Case No. 365 of 1957 : In this case the Income Tax Appellate Tribunal has referred the following questi ..... X X X X Extracts X X X X X X X X Extracts X X X X
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