1983 (3) TMI 75

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....e assessee firm was constituted by an instrument of partnership executed on 11th December, 1972. There are five partners in the firm. Besides, a minor Shri Raju Barman was also admitted to the benefits of partnership according to s.30 of the Indian Partnership Act, 1932. Clauses 3,4 and 5 of this deed are relevant and are reproduced below: "(3) That, the share of the partners in the partnership concern is and shall be as under: (i) Share of the first party i.e. Srimati Kamla Devi 25 paise in a rupee. (ii) Share of the second party i.e. Srimati Pushpa Devi 20 paise in a rupee. (iii) Share of the Third party i.e. Srimati Shanti Devi 25 paise in a rupee. (Iv) Share of the fourth party i.e. Shri Rajendra Kumar Barman ....

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.... share ratio for allocation of the profit as well as the loss had not been clearly specified in the deed and that the provisions of the latter were vague and the share of loss was indeterminable. In this connection, he followed the principle laid down by the Supreme Court in the case of Mandyala Govindu & Co. vs. CIT 1976 CTR (SC) 20: (1976) 102 ITR 1 (SC). He finally refused the benefit of registration to the assessee firm. On this basis, the firm was treated as unregistered in the subsequent two years also. 5. The assessee appealed to the AAC. The latter following the decisions of the Tribunal in the cases of ITO vs. M/s. Vijai Kumar Rajesh Kumar, Varanasi (IAA No. 938 (Alld) of 1977-78) and ITO vs. M/s. Sahyog, Varanasi (ITA No. 2328 ....

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....ecision of CIT vs. Hyderabad Store Depot & Ors. (1977) 109 ITR 686 (AP). The decision was rendered on 14th July, 1972. Subsequently, the Supreme Court pronounced its decision in Nandyala Govindu & Co. vs. CIT 1976 CTR (SC) 20 : (1976) 102 ITR 1 (SC) on 6th October, 1975. The Andhra Pradesh High Court in Hyderabad Stone Depot & Ors. had distinguished the case of CIT vs. Mandyala Govindu & Co. as decided by the Andhra Pradesh High Court itself and reported in (1971) 82 ITR 926 (AP). The court has observed that while in the case of Mandyala Govindu & Co., the deed did not state in what proportion the losses were to be shared by the adult partners, that lacuna was not found in Hyderabad Stone Depot. Subsequently, a doubt had arisen whether the ....