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TMI Blog1956 (2) TMI 1X X X X Extracts X X X X X X X X Extracts X X X X ..... erence made by the Income-tax Appellate Tribunal, Bombay Bench 'A', under section 66(1) of the Indian Income-tax Act (XI of 1922) whereby the High Court answered the referred question against the appellant. The appellant, a firm of Messrs. Pratapmal Laxmichand of Betul consisted of 7 partners, viz., Misrilal Goti, Meghraj Goti, Panraj Goti, Phulchand, Basantibai, Ratanbai and Gokulchand Goti. A deed of partnership was executed on the 12th February, 1944, by all the partners except Gokulchand Goti who happened to be in the Seoni jail being a security prisoner under the Defence of India Rules. He was unable to sign the same in spite of all efforts to obtain his signature in prison. An application for registration of the firm under section 26A of the Act for the assessment year 1943-44 was made on the 24th March, 1944, personally signed by the other 6 partners of the firm and was accompanied by the deed of partnership which also had been signed by those 6 partners. The Special Income-tax Officer, Nagpur, rejected the application on the ground that the deed itself was not valid inasmuch as it had not been signed by all the partners mentioned in the body and there was no signature of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... "after obtaining the signature of Seth Gokulchand both in the application for registration and in the deed of partnership", be deleted. With regard to the latter suggestion the Tribunal observed that they were unable to delete the same inasmuch as the words sought to be deleted were the concluding words appearing in the Appellate Assistant Commissioner's order dated the 17th February, 1948, giving directions to the Income-tax Officer and were words which were material to the question before the High Court. With regard to the first suggestion counsel for the appellant had stated that the appellant had submitted three applications to the Appellate Assistant Commissioner all dated 20th March, 1947, and that it would be wrong to state that no application was submitted to the Appellate Assistant Commissioner. The allegation made by the appellant was properly investigated subsequently and the Tribunal was satisfied that the appellant did not appear to have put in the application dated 20th March, 1947, as alleged. This being the position the Tribunal stated that no change in the statement of case was called for as suggested by the appellant. It was on this statement of case by the Tr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r the provisions of section 26A of the Indian Income-tax Act, 1922, register with the Income-tax Officer the particulars contained in the said instrument on application made in this behalf. Such application shall be signed by all the partners (not being minors) personally and shall be made-- (a) before the income of the firm is assessed for any year wider section 23 of the Act, or...... (c) with the permission of the Appellate Assistant Commissioner hearing an appeal under section 30 of the Act, before the assessment is confirmed, reduced, enhanced or annulled, or........" The decision of the Income-tax Officer in regard to the invalidity of the deed of partnership inasmuch as it did not bear the signature of Gokulchand was not challenged by the appellant at any stage of the proceedings nor in the statement of case before us. Counsel for the appellant, however, relying on a passage in the "Law and Practice of Income-tax by Kanga and Palkhivala", 3rd Ed., at page 754, urged that it was not necessary that the partnership agreement should be signed by all the partners and if the agreement had not been signed by one of the partners but that partner had assented to the agree ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed, therefore proper and we were asked to treat the words "after obtaining the signature of Seth Gokulchand in the application for registration and in the deed of partnership" as superfluous. We are not impressed with this argument. As appears abundantly clear from the terms of the order made by the Appellate Assistant Commissioner himself and also from the statement of case prepared by the Tribunal, the application signed by all the partners personally including Gokulchand was not before the Appellate Assistant Commissioner. An application had been made by the appellant before the Tribunal to amend the statement of case by deleting from paragraph 6 thereof the words "no application was submitted to the Appellate Assistant Commissioner seeking his permission under rule 2(c) of the Indian Income-tax Rules" but the same had been rejected by the Tribunal as a result of proper investigation conducted by it subsequently, the Tribunal stating that they were satisfied that the assessee did not appear to have put in an application dated the 20th March, 1947, as alleged. The reference was heard by the High Court on this statement of case prepared by the Tribunal and no steps were taken b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e High Court could give was that the Appellate Assistant Commissioner was not legally competent to direct the Income-tax Officer to register the firm after obtaining the signature of Gokulchand both in the application for registration and in the deed of partnership. Rule 2(c) above quoted did not empower the Appellate Assistant Commissioner to do anything of the sort and we are of the opinion that the answer given by the High Court in the negative was, therefore, correct. Counsel for the appellant tried to support his argument by referring to the provisions of the earlier partnership deeds between the several partners of this firm in the years 1929 and 1941 which specifically provided that in the event of retirement, or death of, or relinquishment of his share by a partner, the partnership will not be dissolved but will be continued, in case of death of any of the partners, by such of the partners as remained and the legal representatives or nominees of the deceased partner and in the case of retirement of any of the partners by such of the partners as remained. We fail to understand what bearing these clauses have on the determination of the referred question. In the result, th ..... X X X X Extracts X X X X X X X X Extracts X X X X
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