1985 (8) TMI 54

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..... ection 263 passed by the Additional Commissioner of Income-tax? " The assessee was registered as a firm during the assessment year 1968-69, consisting of the following partners: (1) Mirchumal, (2) Laxmandas, (3) Udhavdas, (4) Vasumal, (5) Baldeo, (6) Devidas Minors who were admitted to the benefits of the partnership. Mirchumal entered into a partnership representing the Hindu undivided family known as Chanchaldas Sobhrajmal, of which he was the karta. Shri Laxmandas and Udhavdas were major members of the Hindu undivided family but they joined the partnership firm in their individual capacity and were working partners. Baldeo and Devidas, as mentioned above, were minors and they were admitted to the benefits of the partnership under .....

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..... 185 of the Income-tax Act, 1961, which arose out of the application for registration relating to the assessment proceedings for the year 1970-71, came up for consideration before this court in D.B. Income-tax Reference No. 3 of 1976 and was decided by this court on January 18, 1985 (CIT v. Murlidhar & Co. [1986] 160 ITR 885). This court agreed with the view taken by the Appellate Tribunal and answered the question in the affirmative. Although the question which has been referred in the present case is not in identical terms, yet it is substantially based on the same finding of fact recorded by the Appellate Tribunal. This court in the earlier decision dated January 18, 1985 (CIT v. Murlidhar & Co. [1986] 160 ITR 885), held that it was perm .....

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..... some members of a Hindu undivided family and some strangers. A member of Hindu undivided family is at liberty to contract with any other individual including another member of the Hindu undivided family, subject to the restrictions provided by the Indian Contract Act. This court has already taken the view, in the case relating to the assessee-firm itself for the assessment year 1970-71, that the assessee-firm was validly constituted and was entitled to registration under section 185 of the Act. There is no reason for us to take a different view when the assessee-firm was constituted in the same manner in the assessment year 1968-69 as it was constituted in the year 1970-71. We, therefore, agree with the view taken by the Appellate Tribunal .....

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