TaxTMI 
TaxTMI 
1971 (7) TMI 39
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....6 and 1966-67 ?" Messrs. Ram Saran Inder Singh, Khanna, a partnership firm, was registered with the income-tax department up to the assessment year 1963-64. It had the following partners : 1. Shri Ram Saran. 2. Shri Inder Singh. 3. Shri Bali Ram. 4. Shri Behari Lal. The shares of the partners in profit and loss were equal. During the account year relevant to the assessment year 1964-65, there was a change in the constitution of the firm. Shri Bali Ram retired. His place was taken by Hans Raj, son of Mehnga Ram with effect from 13th September, 1963. A fresh deed of partnership was executed on 18th September, 1963. The shares of the partners in profit and loss were equal. However, in the account books for the period commencing from 13th....
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.... claim for continuation of the registration under section 184(7) for the two subsequent assessment years 1965-66 and 1966-67. The assessee then preferred an appeal to the Appellate Assistant Commissioner of Income-tax, who held that for the first period, that is, from 1st April, 1963, to 12th September, 1963, the assessee was entitled to registration and that for the period from 13th September, 1963, to 31st March, 1964, the registration had been rightly cancelled. As a consequence, the order of the Income-tax Officer refusing continuation of registration of the firm for the years 1965-66 and 1966-67 was upheld. The assessee then preferred an appeal to the Income-tax Appellate Tribunal. Before the Tribunal it was urged that no doubt the a....
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....t out above, for the opinion of this court and the Tribunal by its order dated 8th December, 1970 accordingly, has referred the said question. Mr. Awasthy, learned counsel for the department, has contended that the order of the Tribunal cannot be sustained. He has drawn our attention to sections 184, 185 and 187(2). He has also urged that the registration of the firm in order to be effective has to be during the assessment year in question, though under sub-section (7) of section 184 it shall have effect for every subsequent assessment year, provided there is no change in the constitution of the firm or the shares of the partners and it furnishes along with its return of income for the assessment year concerned a declaration to that effect....
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....partnership deed. This led to the cancellation of the partnership deed. The corrigendum which brought the shares in accord with the distribution of profits was furnished on 7th October, 1966. There was no valid partnership deed in existence, vis-a-vis the newly constituted firm till that date. Therefore, the partnership deed executed on 18th September, 1963, became operative in the year 1966 and in the assessment year in which the corrigendum was executed the partnership became entitled to registration, and that registration could not have retrospective effect. The view we have taken of the matter finds support from the decision of the Supreme Court in N. T. Patel & Co. v. Commissioner of Income-tax. In our opinion, the argument of Mr. Awa....