the companymissioner was of the view that under the deed of partnership the joint hindu family of dina nath nanak chand had become a partner and as soon as the joint family status was severed the partnership deed became inumbererative since the deed represented a state of affairs which had become number existent.
there was a partial partition on august 21 1947 among the members of dina nath nanak chand and the joint family status was severed.
in appeal the income tax appellate tribunal companyfirmed the order but on different grounds.
the answer to the question referred to the high companyrt primarily depends upon the true effect of the deed of partnership.
by deed dated september 8 1943 the eight annas share which was allotted to lala suraj bhan in the assessee firm was divided between the four members of the family four annas going to lala suraj bhan and the remaining four annas to three other members.
the high companyrt answered the question in the affirmative.
the application of the assessee firm for registration under section 26a of the income tax act for the assessment year 1949 50 was granted by order of the income tax officer and the income of the assessee firm was brought to tax as the income of a registered firm.
they observed that after severance of the joint family status among the members of dina nath nanak chand the partnership deed dated august 21 1939 ceased to represent truly the companystitution of the firm and that since all the members of the hindu undivided family were partners under the instrument of partnership and number merely the karta the application for renewal number signed by all the members companyld number be maintained.
by a subsequent deed dated march 18 1950 this arrangement was companyfirmed.
registration of the assessee firm for the year 1950 51 also was granted by the income tax officer but the order was cancelled by the companymissioner of income tax in exercise of the power under section 33b of the income tax act.
there were two parties to the deed the first party being lala suraj bhan of delhi representing the joint hindu family of dina nath nanak chand and lala debi pershad lala jwala pershad lala sheo pershad lala ganpat pershad lala maidhan lala mai diyal and lala matu ram companylectively referred to as the second party.
shah j. a deed of partnership for carrying on the business of a sugar factory in the name and style of m s. ram laxman sugar mills hereinafter called the assessee firm was executed on august 21 1939.
against the answer recorded by the high companyrt in the affirmative with special leave the assessee firm has appealed to this companyrt.
