K.S. Viswanathan, Accountant Member - (1.)WE find it convenient to dispose of these 3 appeals by the assessee by a common order. The Commissioner has set aside the orders of the Income-tax Officer granting continuation of registration for the asst. years 1980-81 to 1982-83 and the assessee is in appeal against the Commissioner's order.
(2.)The assessee is a partnership firm constituted by a deed of partnership dated 1st April, 1977. As per this partnership deed, there are two major partners and six minors admitted to the benefits of the partnership. Clause 6 of the partnership deed gives the share of each partner and minor in the profit and losses. In case of profits, the two major partners would be entitled to 20% and each minor would be given 10% as their share. In case of loss, one partner Syed Mohd. Iqbal will have to bear 80% of the loss and the other partner Syed Hussain Shakeel 20%. Clause 7 of the partnership deed reads as follows: -
Minors as and when they attain majority, shall become full-fledged partners automatically sharing profits or losses as per shares specified to each. No fresh deed of Partnership shall be executed but the same Deed shall be operative.

The assessee had filed application for registration of the firm for the asst. year 1978-79 and that was granted. For all the subsequent asst. years, the assessee had been granted continuation of registration.

Out of the two minors, Syed Abdul Rahman Khaleel became a major on 7-5-1978. Another minor Syed Ahmed Jameel attained majority on 12-11-1980. The assessee firm did not draw up a fresh partnership deed on both these occasions. The Income-tax Officer had granted registration in spite of this fact.

(3.)THE Commissioner was of opinion that the order of the Income-tax Officer allowing continuation of registration for these 3 asst. years is wrong. He pointed out that after the minors have attained majority, there is a change in the constitution of the firm and it requires a fresh deed of partnership to be executed. Further, the assessee ought to have applied for fresh registration in Form No. 11A. THEy had filed only declarations for continuation of registration. Even if clause-7 of the Partnership Deed would be said to be fulfilling the requirements of indication of the share of the two minors on attainment of majority, he pointed out that there was ambiguity with regard to the losses. For these reasons, he held that the Income-tax Officer had wrongly allowed continuation of registration for the 3 asst. years. He, therefore, cancelled these orders and directed the fresh assessments to be made as unregistered firm.