COMMISSIONER OF INCOME TAX Vs. NEW LIFE CONSTRUCTION CO

JUDGEMENT

(1.) THE question in this reference relates to registration of a firm and it is as under:

(2.) A firm by the name and style of New Life Construction Co. was constituted w.e.f. April 1, 1957, consisting of, as appearing from the preamble of the deed, dated April 5, 1957, four partners, namely, (1) Parsram Dhamanlal Mariwalla, (2) Madhavji Khimji, (3) Laxman VeIji, and (4) M/s Jay Vishin (Se Co., partners 1 and 4 having one third share each and the other partners having one sixth share each therein. The partners were to share the losses in the same proportion. Clause 4 of the deed related to capital contribution. Clause 13 thereof provided for control over financial matters and cl. 16 provided for contingency arising on the death of any partner. In the agreed statement of the case it is clearly stated that the partnership deed was signed by Parsram D. Mariwalla, Madhavji Khimji, Laxman Velji and Vishindas Lekhraj and Jawahar Lekhraj, partners of Jay Vishin & Co., for and on behalf of M/s Jay Vishin & Co. Mr. Joshi on behalf of the Revenue has fairly brought to our pointed attention the statement in the agreed statement of the case that the partnership deed was signed by Vishindas Lekhraj and Jawahar Lekhraj, partners of Jay Vishin & Co., for and on behalf of Jay Vishin & Co., the fourth partner, even though the partnership deed annexed is exhibit A thereto shows that on behalf of Jay Vishin & Co., its partner, Vishindas Lekhraj, has signed. In view of this statement in the statement of the case Mr. Joshi rightly told us that we shall have to proceed on the footing that the partnership deed is signed by all the five partners.

(3.) THESE applications for registration of the assessee firm were accompanied by both the deeds of partnership respectively executed on April 5, 1957, and April 25, 1957. When the matter came up before the ITO he suggested that a supplementary deed should be made in order to make the position clear, to the effect that the deed dated April 5, 1957, was a deed of partnership between individual members of the firm, their shares being specifically mentioned therein. Accordingly, the assessee drew up a supplementary deed dated October 7, 1959, and the same was also filed before the ITO.