Partnership registration depends on genuineness of the firm, not separate proof of each partner's initial capital contribution.

A partnership firm is entitled to registration where the deed names the partners, fixes profit and loss shares, and the evidence shows actual division of profits in accordance with the deed. Failure to prove that one partner separately contributed the initial capital does not, by itself, make the partnership unreal or the partner non-genuine. The legal test remains whether there is a real agreement to share profits or losses and business is carried on by or on behalf of the partners. On this reasoning, refusal of registration was not justified and registration was allowed.

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Issues: Whether the assessee firm was entitled to registration under the income-tax law despite dispute regarding capital contribution by one partner and the genuineness of the partnership.

Analysis: The partnership deed showed two partners, defined profit and loss shares, and evidence of actual division of profits in accordance with the deed. The absence of satisfactory proof that one partner had independently contributed the initial capital did not by itself establish that the firm was unreal or that the partner was not genuine. A partnership in law depends on agreement to share profits or losses and on business being carried on by or on behalf of all partners. On the authorities applied, lack of separate capital contribution by a partner is not, by itself, a ground to refuse registration where the partnership is otherwise genuine and operational.

Conclusion: The firm was entitled to registration and refusal of registration was not justified.

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