1983 (4) TMI 34

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.... assessment years 1971-72 and 1972-73. The assessee-firm was constituted by a deed of partnership executed on 10th November, 1961, and it consisted of four partners and three minors were admitted to the benefits of the partnership. The minors attained majority on 4th May, 1966, 27th May, 1967, and 21st July, 1971, respectively, and elected to become partners. The partnership was not granted continuation of registration for the assessment years 1967-68, 1968-69 and 1969-70. There was a reference to this court in respect of these assessment years. The judgment of the court, in this reference, is Durgaprasad Rajaram Adatiya v. CIT [1982] 134 ITR 601. It was held that as the instrument of partnership did not provide, as to how the losses would ....

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....he constitution of the firm and the partnership was not entitled to continuation of registration. This view was taken in Ganesh Lal Laxmi Narain v. CIT [1968] 68 ITR 696 (All) and Ram Narain Laxman Prasad v. ITO [1972] 84 ITR 233 (All). It was to get over this view that the Board issued the second circular of 1969. The view taken by the Allahabad High Court in these cases was overruled by a Full Bench in Badri Narain Kashi Prasad v. Addl. CIT [1978] 115 ITR 858 (All) [FB]. The view of the Full Bench is that if the deed of partnership envisages the eventuality of the minor becoming a full-fledged partner on attaining majority and provides for the distribution of profits and losses, in that event, there would be no change in the constitution ....