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TMI Blog1957 (4) TMI 78X X X X Extracts X X X X X X X X Extracts X X X X ..... he ground that two of the partners, namely, Uma Shankar Sahai and Narendra Shankar Sahai, were minors and the document of partnership was invalid on that account. The assessee took the matter on appeal to the Appellate Assistant Commissioner against the decision of the Income-tax Officer, but the appeal was dismissed. The Appellate Tribunal also took the view that the minors were shown as full-fledged partners in the partnership deed, sharing both profits and losses, and, therefore, the partnership could not be registered by the Income-tax authorities under section 26A. At the instance of the assessee the Appellate Tribunal has made a statement of the case under section 66(1) of the Income-tax Act on the following question of law: W ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d he may have access to and inspect and copy any of the accounts of the firm. (3) Such minor's share is liable for the acts of the firm, but the minor is not personally liable for any such act... (5) At any time within six months of his attaining majority, or of his obtaining knowledge that he had been admitted to the benefits of the partnership, whichever date is later, such person may give public notice that he has elected to become or that he has elected not to become a partner in the firm, and such notice shall determine his position as regards the firm: Provided that, if he fails to give such notice, he shall become a partner in the firm on the expiry of the said six months . Section 2(6B) of the Income-tax Act i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er of construction of the deed of partnership that these two minor partners were admitted to the benefits of the partnership. It is true that paragraph 8 and paragraph 17 of the partnership deed states that all the partners, including the minor partners, would be liable for the loss borne by the partnership. But this clause has no legal effect so far as the minor partners are concerned because in the eye of law the minor cannot become a partner or become liable for losses but he is only entitled to the benefit of profits according to his share. As a matter of construction, therefore, we consider that the deed of partnership dated the 22nd May, 1949, should be interpreted only as admitting the two minor partners, Uma Shankar Sahai and Narend ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... minor is described as a partner as a valid partnership consisting of adult partners excluding the minor who may be regarded as having been admitted to the benefits of the partnership. This question was not examined in the Punjab s case (supra). Counsel on behalf of the Income-tax Department also referred to two other cases, Hoosan Kasam Dada v. Commissioner of Income-tax [1937] 5 ITR 182, and Raju Chettiar and Brothers v. Commissioner of Income-tax [1949] 17 ITR 51 . We do not consider that the ratio of these two cases has any application to the present case. In Hoosan Kasam Dada s case (supra), the question for determination was whether a wakf created under the Muhammadan law could enter into a partnership with other persons and whether su ..... X X X X Extracts X X X X X X X X Extracts X X X X
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