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2016 (8) TMI 741 - HC - Income TaxPartnership firm - profit sharing ratio - Applicability of section 13(b) of the Indian Partnership Act on a firm - Held that:- The provisions of section 13(b) of the Partnership Act and clause 7 of the partnership deed dated 16.9.1981, this Court held that section 13(b) of the Act would apply only when there is no contract to the contrary and that a look at clause 7 of the Partnership deed would show that there is a contract to the contrary. Proceeding further, this Court has referred to the judgment in Saraf Trading Corporation [1998 (8) TMI 41 - KERALA High Court ] and thereafter held that “hence, according to us, section 13(b) of the Partnership Act will not apply”. Thus, there is a categoric finding in the judgment in Nalini V.Saraf (2003 (7) TMI 22 - KERALA High Court ) that section 13(b) of the Partnership Act will not apply to the firm. The aforesaid facts would show that the Tribunal was justified in its conclusion that section 13(b) of the Partnership Act would not apply. Consequently, the Tribunal's order dismissing the appeals of the Revenue cannot be interfered with as illegal. - Decided in favour of assessee.
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