Partnership deed must specify partners' shares for firm registration; later rectification cannot cure the original omission.

Registration of a firm under section 184 requires a partnership instrument that evidences the firm and specifies the individual shares of the partners during the relevant accounting year. Where the deed on record is silent on the partners' shares, that omission cannot be cured by a later deed of rectification executed after the close of the year. The Court distinguished cases where surrounding circumstances and the deed itself supported an inference of specified shares, holding that such inference was unavailable here because the instrument did not contain the necessary terms. The assessee-firm was therefore not entitled to registration, and the reference was answered against it.

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Issues: Whether the assessee-firm was entitled to registration under section 184 of the Income-tax Act, 1961, when the partnership instrument did not specify the individual shares of the partners and the shares were later inserted by a deed of rectification executed after the close of the accounting year.

Analysis: Registration of a firm under section 184 depends upon an instrument of partnership evidencing the firm and specifying the individual shares of the partners. The relevant deed, as found on the record, did not contain such specification. The subsequent deed of rectification, executed after the close of the accounting year, could not satisfy the statutory requirement for the earlier year. The Court distinguished the authorities relied upon by the assessee on the ground that, on the facts there, the surrounding circumstances and the deed itself supported a finding of specification of shares, whereas in the present case the deed was silent on that point and the necessary terms could not be inferred from surrounding circumstances alone.

Conclusion: The assessee-firm was not entitled to registration. The question referred was answered in the affirmative and against the assessee, in favour of the Revenue.

Ratio Decidendi: For registration of a firm, the partnership instrument must specify the individual shares of the partners during the relevant accounting year, and a post-year deed of rectification cannot cure the original omission.

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