Partner's appeal rights over firm income apportionment exist only when individually assessable on the firm's income.

A partner's right of appeal against apportionment of firm income exists only where the partner is individually assessable on his share of the firm's total income. That condition applies to a registered firm, or an unregistered firm assessed as registered under section 183(b), but not to an unregistered firm whose share is merely included for rate purposes under section 86. Statutory apportionment under section 158 follows the same limited scheme. Accordingly, a partner of an unregistered firm has no right of appeal under sections 246(c) and 247 against such apportionment.

---

---

Issues: Whether a partner of an unregistered firm, whose share of the firm's income was allocated for rate purposes, had a right of appeal against the apportionment under sections 246(c) and 247 of the Income-tax Act, 1961.

Analysis: The right of appeal under section 247 is confined to a partner who is individually assessable on his share in the total income of the firm. That condition is satisfied where the firm is registered, or an unregistered firm is assessed as a registered firm under section 183(b). In the case of an unregistered firm, the partner's share included for rate purposes under section 86 does not make the partner individually assessable on the firm's profits. Apportionment under section 158 is also statutorily required only in the case of a registered firm or an unregistered firm assessed as registered. The governing precedent held that no such appellate right exists for a partner of an unregistered firm.

Conclusion: A partner of an unregistered firm has no right of appeal under sections 246(c) and 247 against apportionment of the firm's income; the answer is in favour of the Revenue.

Ratio Decidendi: The appellate right under section 247 is available only where the partner is individually assessable on the firm's income, which excludes a partner of an unregistered firm assessed as such.

---