TMI Blog1980 (1) TMI 11X X X X Extracts X X X X X X X X Extracts X X X X ..... n of a partner ? (2) Whether, on the facts and in the circumstances of the case, the Tribunal was correct in holding that the assessee-firm was entitled to registration under section 185 of the Income-tax Act, 1961 ? " The brief facts giving rise to the reference are that the firm known as M/s. Eclat Auto Agency, Amritsar, came into existence on 18th October, 1963, and it consisted of four partners, namely, Sarvshri Charanjit Lal Aggarwal, Paras Prabhu Aggarwal, Ravinder Kumar Aggarwal and Kamal Narain Aggarwal. Shri Surinder Kumar Aggarwal, a minor, had been admitted to the benefits of the partnership. On 31st August, 1966, Shri Charanjit Lal Aggarwal retired from the said partnership and the remaining partners including Shri Suri ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s contention. A suit was next instituted by him in the Court of the Sub-judge, Delhi, for a declaration that he had retired and severed all connections with the firm of M/s. Eclat Auto Agency from 1st April, 1969, and was not, therefore, liable for any acts of commission or omission of the firm towards the income-tax, sales tax or any other authority. On 4th June, 1969, the remaining partners, namely, Sarvshri Paras Prabhu Aggarwal, Ravinder Kumar Aggarwal, Kamal Narain Aggarwal and Surinder Kumar Aggarwal, executed a new partnership deed and carried on the same business with effect from 1st April, 1969. This firm was registered with the Registrar of Firms and the sales tax dept. On the basis of the partnership deed dated 4th June, 1969, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tnership came into being between the five brothers including Shri Charanjit Lal with effect from 1st October, 1968, under a deed dated 23rd August, 1968. There was no specification of the period or duration for which this partnership was to operate it was thus a partnership at will. In so far as the revenue's contention that one of the partners could not be expelled by the other partners there can next be no quarrel. Section 33 clearly provides that unless there be a contract to the contrary, a partner may not be expelled from a firm by any majority of the partners. Such expulsion further cannot be treated in the nature of differences arising as to the ordinary matters connected with the business as envisaged by section 12(c). However, the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . The new firm constituted of the four partners is evidenced by partnership deed. It has duly operated business. There is no averment that the profits have not been divided in accordance with the profit-sharing ratio mentioned in the partnership deed. In the situation, there were no reasons for not granting it registration. We do not find any force in this revenue appeal. The same is rejected." At the instance of the revenue, the questions reproduced in the earlier part of this judgment, have been referred to this court for its opinion. After hearing the learned counsel for the parties we are of the opinion that both the questions referred to above have to be answered in the affirmative, i. e., against the revenue and in favour of the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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