Firm cannot be treated as a separate partner for registration under section 26A; individual shares and personal signatures are required.

For registration under section 26A of the Indian Income-tax Act, 1922, the partnership had to be constituted by individual partners whose shares were specified in the instrument, and the application had to be personally signed by all partners. The scheme treated the partners as the relevant taxable units, so a firm could not be treated as a separate legal entity capable of entering into partnership as such with another firm or with individuals for registration purposes. The inclusive definition of "person" in the General Clauses Act, 1897 did not apply where it conflicted with the subject and context of section 26A and the rules. On that reasoning, a firm as such was not entitled to enter into partnership for registration under section 26A.

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Issues: Whether a firm, as such, can enter into partnership with another firm or individuals for the purpose of registration under section 26A of the Indian Income-tax Act, 1922, and whether the statutory requirements of individual shares and personal signatures can be satisfied where the ostensible partner is a firm.

Analysis: The scheme of registration under the Indian Income-tax Act, 1922, treats the individual partners as the taxable units and requires the partnership instrument to specify their individual shares. Rule 2 of the Indian Income-tax Rules, 1922, further requires the application to be signed personally by all the partners. Although the Indian Partnership Act, 1932 recognises certain incidents of separateness for a firm, those provisions do not convert a firm into a separate legal entity capable of entering into partnership as such. The inclusive definition of "person" in the General Clauses Act, 1897 cannot be applied where it would be repugnant to the subject and context of section 26A and the allied rules.

Conclusion: A firm as such is not entitled to enter into partnership with another firm or individuals for registration under section 26A of the Indian Income-tax Act, 1922. The question referred was answered in the negative, against the assessee and in favour of the Revenue.

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