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Claim of registration denied due to unspecified profit sharing ratio in partnership deed. Analysis: The main issue in this appeal was the denial of registration by the ITO and AAC based on the lack of specification of profit sharing ratio in the partnership deed. The counsel for the assessee argued that although a proforma partnership deed was used, clauses 6, 16, and 24 clearly indicated equal profit sharing. The counsel relied on various case laws to support the claim, emphasizing equal capital contribution and profit division. The Tribunal observed that clauses 6, 16, and 24 of the partnership deed implied equal profit sharing, supported by the conduct of both partners. The Tribunal referenced the Parekh Wadilal Jivanbhai case to highlight the importance of interpreting partnership deeds holistically to determine profit sharing. The Tribunal also considered the Krishna Mining Co. case, emphasizing that specification of shares can be implied and does not require explicit mention. The Tribunal further discussed the Alankar Jewellers case, emphasizing the need for the ITO to notify firms of any defects in registration applications. The Tribunal noted that the partnership deed in question explicitly stated that the partnership would be governed by the Indian Partnership Act. The Tribunal also addressed the case of Kyalasa Sarabhaian, clarifying that specifying shares does not necessarily mean expressing them in fractional terms. The Tribunal disagreed with the Departmental Representative's reliance on the Nandlal Sohanlal case, as the partnership deed itself adopted the application of the Indian Partnership Act. The Tribunal distinguished the Dastur Dadi and Co. case, emphasizing the importance of evidence within the partnership deed itself. In conclusion, the Tribunal reversed the AAC's decision and allowed the assessee's appeal, ruling in favor of registration based on the equal profit sharing implied in the partnership deed and supported by relevant case law.
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