9911796707
TMI Blog1976 (7) TMI 22X X X X Extracts X X X X X X X X Extracts X X X X ..... share the profits thereof respectively, at the ratio of 22 nPs., 34 nPs., 22 nPs. and 22 nPs. Under clause 2 of the partnership deed the partnership was to commence with effect from January 1, 1960. Under clause 7 thereof the accounting year was to be the calendar year or any other year as might be decided from time to time. In actual practice, the accounts were kept on calendar year basis. Under clause 9 thereof the partnership was to be a partnership at will. Clause 11 of the partnership deed is as under : " 11. In the case of death or insolvency of any of the partners, this partnership shall be carried on by the remaining partners along with any additional partner or partners who shall share in the share of the outgoing partner on the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ation in Forms Nos. 11 and 11A (the former form is to be used when there is no change in the constitution of the firm or the shares of the partners of the firm applying for initial registration during the previous year before the date of the application, while the latter form is to be used when there are such changes). On the very date on which these applications were made, namely, on September 29, 1962, the assessee also filed a declaration under section 184(7) of the Income-tax Act, 1961, in Form No. 12 for obtaining renewal of registration. In all these forms, the names of the three surviving partners, S. S. Tambe, V. S. Tambe and D. S. Tambe were shown with their revised shares of profit, i.e., 40%, 30% and 30%, respectively. The Inc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that even though there was change in the constitution of the firm, the shares of the partners were divided according to the terms of the partnership deed because such contingency had been expressly provided under the partnership deed. He pointed out that in the relevant previous year for the assessment under consideration there was no change in the constitution of the firm or the shares of the partners on the basis of which registration was granted for earlier year. As a declaration as contemplated by the proviso to sub-section (7) of section 184 was furnished, according to him the Income-tax Officer was under an obligation to renew the registration of the firm under the provisions of section 184(7)of the Act. In an appeal by the revenue ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... partners showing their respective shares. The Tribunal also observed in the course of its judgment that if there is no earlier registration of the firm which enables the assessee to file a proper declaration under section 184(7) it is obvious that section does not govern the assessee's case. The registration granted earlier does not thus come to the rescue of the assessee since that registration was not based on an instrument of partnership evidencing the constitution or the shares of the partners. In view of this reasoning the Tribunal set aside the order that was passed by the Appellate Assistant Commissioner and restored the order that was passed by the Income-tax Officer. The question above set out arises from this order of the Tribunal ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... gistration could ever be granted. He, therefore, submitted that the Tribunal was right in restoring the order of the Income-tax Officer refusing to grant renewal of registration. At the outset, it may be stated that when questions about particular facts necessary for determination of the matters in controversy in this reference were put to the counsel, nobody was in a position to give a categorical answer, probably because, there was no other person to give instructions to them nor the necessary records were before the court. For the assessment year 1961-62 the firm which was granted registration by the Income-tax Officer was the firm consisting of four partners which was constituted under the deed of partnership dated March 18, 1960. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... respective shares. In fact there is no material to indicate that registration is granted to the firm of three partners with their respective revised shares of 40%, 30% and 30%. However, if the order of the Income-tax Officer is to be interpreted as registration having been granted to such a firm constituted of the three surviving partners, then there was no instrument of partnership evidencing the respective shares of the partners who constituted this firm. Therefore, if at all it was so granted it was erroneously done. What really appears to have been done in the present case is that but for the original partnership deed dated March 18, 1960, there was no other partnership deed and for the assessment year 1962-63 the earlier deed of partne ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
