Constitution by Instrument: an oral partnership later reduced to writing is eligible for registration when the instrument specifies partners' shares.

A partnership originally formed orally but later reduced to a written partnership instrument specifying individual partners' shares qualifies as "constituted under an instrument" for the purpose of registration; the instrument need not have been the original mode of creation, and presentation of such a written deed with the application renders the firm eligible for registration, distinguishing retrospective effect on assessments from the requirement for registration.

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Issues: Whether a firm that originally came into existence by oral agreement can be registered under section 26A if, on the date of application for registration, the terms of the partnership have been reduced to writing and the application is accompanied by such an instrument.

Analysis: Section 26A allows application for registration of any firm "constituted under an instrument of partnership" specifying the individual shares of partners. The Court examined whether the phrase "constituted under an instrument" requires that the partnership must have been created by the written instrument ab initio, or whether a partnership that existed orally but later formalised by a deed may be treated as constituted under the instrument for registration purposes. The Court distinguished the retrospective effect of a deed on assessments from the question of registration and held that the instrument need not have been the original mode of creation: when partners execute and present a partnership instrument specifying shares, the firm is entitled to registration under section 26A notwithstanding allegations in the instrument that the partnership previously existed orally on the same terms.

Conclusion: The question is answered in the affirmative; a partnership which was originally oral but whose terms have been reduced to a written instrument and presented for registration may be treated as constituted under that instrument for the purposes of registration under section 26A, and therefore is entitled to registration.

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