TaxTMI 
TaxTMI 
1980 (6) TMI 71
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....the assessee M/s. Kodan Das Kishan Das for asst. yr. 1973-74 for which the relevant previous year came to an end on 23rd Dec., 1972 and the issue involved pertains only to registration not granted by the ITO under s. 185(1)(b) and the action of the AAC who confirmed the said order of the ITO. 2. Briefly to state the facts of the case, the firm styled M/s. Kodan Das Kishan Das has been doing grain and commission agency business since November 1963. Originally, in the said firm Mohinidevi and her two major sons, Lekhraj & Vishandas, were the three fullfledged partners, whereas Gordhandas, Suresh Kumar and Laxman Das, other three sons of Mohini Devi, who were minors then, were admitted to the benefits of the partnership. When Gordhandas att....
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....t July, 1953 and thus became major on 31st July, 1971. The ITO observed that benefits to the minor granted under s. 30 of the Indian Partnership Act could not be available after he had attained age of majority. According to him, Suresh Kumar who was born on 31st July, 1953 attained majority on 31st July, 1971 itself and hence he could not be legally admitted to benefits of partnership as a minor as per deed executed on 1st Jan., 1972 which commenced business from 2nd Jan., 1972. According to him, the deed was dt. 1st Jan., 1972 having Mr. Suresh Kumar as fullfledged partner, neither the said deed nor the application under s. 11A was signed by Shri Suresh Kumar. For the second deed dt. 23rd Dec., 1972, on the basis of which registration appl....
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....or and it was in good faith, without any ulterior motive that he was admitted to the benefits of partnership. He alternately submitted that the subsequent deed dt. 23rd Dec., 1972 was executed on the last date of the accounting year and it could be so executed legally. Regarding the late filing of registration application in Form 11A on 9th Jan., 1974 on the basis of this deed, he submitted that it was not on the basis of this being late that the registration was cancelled by the ITO and the AAC in last para of his order has only observed that the application for registration in Form 11A submitted on 9th Jan., 1974 was not in accordance with the Rules. He drew out attention to s. 36 of the IT Act and relied upon Sita Ram Bhagwan Dass(1), in....
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....ege and the assessee should have been careful for drawings its deeds, we find from the development of facts pertaining to different constitutions of partnership from year to year that the assessee seems to have been more careful than needed. The ITO in the original assessment proceedings has not based the cancellation of registration on the plea that the application of the assessee dt. 9th Jan., 1974 is out of time, whereas the AAC also in para 10 of his order has observed that the same is not as per Rules, though in para 7 of his order he has mentioned the said application to be beyond the time allowed. From the perusal of all the facts on record and both the partnership deeds dt. 1st Jan., 1972 and 23rd Dec., 1972, we are unable to accept....
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....ch if considered on preponderance of probabilities with the assessee firm has been that in its deed dt. 1st Jan., 1972 Shri Suresh Kumar was shown as a minor and admitted to the benefits of partnership as such, whereas actually he had acquired majority. This defect itself could not be fatal to the assessee's claim of registration on petty issues of absence of signatures of partner on the registration Form 11A or in the deed as discussed by the AAC in para 2 and 3 of his order because so far defects in application are concerned, they were capable of being got rectified after the same were pointed out by the Revenue to the assessee and so far the defect in the partnership deed of Suresh Kumar's signature is not being there, the same arose out....
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.... relied on a Patna High Court decision in the case of Sitaram Bhagwandas(1), in which their Lordships held as under: "Having regard to the spirit and substance of the provisions regarding registration of firms in s. 184(7) of the IT Act, 1961, it is clear that the term "alongwith its return of Income" (as it stood before 1st April, 1971) is merely directory and not mandatory. The law must be so construed as to not make it in any way illogical or ridiculous. All that the legislature intended was that the return should be duly filed and the declaration should be duly made and both the documents should be before the assessing authority at the time when he is applying his mind to the assessment of any particular firm. If he is then satisfied....