Dipak Kumar Sen, J. - (1.) The controversy in this reference is in respect of the registration of Messrs. Kumar Financing Corporation, Calcutta the assessee, which is a partnership firm. The facts found and/or admitted areas follows: The assessee was originally constituted by a deed executed on the. 7th December, 1957. On the 30th July, 1961, Anandilal Poddar, one of the partners, died and thereafter a new deed was executed on the 1st August, 1961, whereby the legal representative of the deceased partner was inducted into the firm. The other partners and their shares remained unaltered.
(2.) In respect of the assessment year 1962-63, by an application dated the 23rd May, 1963, filed under Section 184(7) of the I.T. Act, 1961, the partners of the firm as constituted by the earlier deed applied for continuation of the firm's registration for the period from the 1st April, 1961, to the 31st July, 1961, and by another application dated the 12th March, 1962, un.der Section 26A of the Indian I.T. Act, 1922 the partners of the new firm applied for registration for the period from the 1st August, 1961, to the 31st March, 1962. Inasmuch as the Indian I.T. Act, 1922, stood repealed on and from the 1st April, 1962, the partners of the new firm preferred a fresh application in Form No. 11-A under the I.T. Aet, 1961, for registration as directed by the ITO.
(3.) In the proceedings which followed the ITO found that the two minors admitted to the benefits of the partnership, namely, Pinku Kanoria and Munna Kanoria, respectively, the daughter and the son of Basudeo Kanoria, at no time withdrew anything from the firm on account of their shares in the profits and the entire amounts were allowed to accumulate. Though excluded from the benefits of the partnership from the 26th September, 1962, such accumulations aggregating to Rs. 88,360'47 remained credited with the firm. It was further found that the minors had each 15 paise share in the profits as against 5 paise share of the active adult partners. Munna Kanoria was assessed in the name of Harshvardhan Kanoria from the assessment year 1962-63 onwards only and in the assessments for 1962-63 and 1963-64 his share in the profits of the firm was not shown and it was not even declared that he was entitled to the benefits of the partnership. His wealth-tax returns were not filed. Neither income-tax nor wealth-tax returns were filed on behalf of Pinku Kanoria at all.;