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Commissioner of Income-tax, Karnataka Vs. Kinema Reinforced Plastics - Court Judgment

LegalCrystal Citation
SubjectDirect Taxation
CourtKarnataka High Court
Decided On
Case NumberIncome-tax Reference Cases Nos. 243 and 244 of 1979
Judge
Reported in(1984)39CTR(Kar)7; [1985]152ITR216(KAR); [1985]152ITR216(Karn)
ActsIncome Tax Act, 1961 - Sections 184
AppellantCommissioner of Income-tax, Karnataka
RespondentKinema Reinforced Plastics
Appellant AdvocateK. Srinivasan, Adv.
Respondent AdvocateG. Sarangan, Adv.
Excerpt:
.....of the execution of the instrument. that is what the tribunal precisely did by referring to the documents dated september 6, 1966, and september 29, 1972, and also the document dated january 1, 1958. 4. so far as the first ground on which the ito refused registration is concerned, it is already concluded by our decision in itr cs. lakshmi talkies [1984]145itr191(kar) .therein, we have held that if the deficiency of the stamp duty is made good it shall relate back to the date of the execution of the document. the tribunal, therefore, was justified in stating that the instrument was duly stamped when the deputy commissioner certified that the deficiency was made good on april 22, 1978. 5. as to the second ground above referred to, suffice it to state that it is well settled law that two..........between the parties to the documents. that is what the tribunal precisely did by referring to the documents dated september 6, 1966, and september 29, 1972, and also the document dated january 1, 1958. 4. so far as the first ground on which the ito refused registration is concerned, it is already concluded by our decision in itr cs. nos. 130 & 131 of 1981 disposed of on october 19, 1983 - since reported in cit v. lakshmi talkies : [1984]145itr191(kar) . therein, we have held that if the deficiency of the stamp duty is made good it shall relate back to the date of the execution of the document. the tribunal, therefore, was justified in stating that the instrument was duly stamped when the deputy commissioner certified that the deficiency was made good on april 22, 1978. 5. as to the.....
Judgment:

Rajasekhara Murthy, J.

1. The Income-tax Appellate Tribunal, Bangalore Bench, has referred the following question of law under s. 256(1) of the I.T. Act, 1961, for the two assessment years 1973-74 and 1974-75 :

'Whether, on the facts and in the circumstances of the case, the Tribunal was right in law in holdings that there was a valid partnership entitled for registration under the Income-tax Act, 1961, for the assessment year 1973-74 and continuation of registration for 1974-75 ?'

2. The assessee is a firm. The ITO refused registration to the firm, firstly, on the ground that the deed dated September 29, 1972, was insufficiently stamped and, secondly, the share of the partners was not specified.

3. The assessee appealed to the AAC against the refusal to grant registration. The AAC also dismissed the appeal. Upon further appeal by the assessee, the Tribunal observed that so far as the deficiency in payment of stamp duty was concerned, the same was made good as evidenced by the certificate dated April 22, 1978, issued by the Deputy Commissioner of Stamps & Head Quarters Assistant to the District Registrar, Bangalore, and the payment of stamp duty must relate back to the date of the execution of the instrument. So far as the second ground was concerned, the Tribunal considered the three documents executed as between the partners for the purpose of findings out the existence of the partnership and the allotment of shares. In paragraph 5 of the order, the Tribunal has referred to those three documents. It is not disputed that a partnership can be evidenced by more than one instrument. It is open to the authorities to come to a conclusion, regard being had to the several documents, that a partnership has come into existence as between the parties to the documents. That is what the Tribunal precisely did by referring to the documents dated September 6, 1966, and September 29, 1972, and also the document dated January 1, 1958.

4. So far as the first ground on which the ITO refused registration is concerned, it is already concluded by our decision in ITR Cs. Nos. 130 & 131 of 1981 disposed of on October 19, 1983 - since reported in CIT v. Lakshmi Talkies : [1984]145ITR191(KAR) . Therein, we have held that if the deficiency of the stamp duty is made good it shall relate back to the date of the execution of the document. The Tribunal, therefore, was justified in stating that the instrument was duly stamped when the Deputy Commissioner certified that the deficiency was made good on April 22, 1978.

5. As to the second ground above referred to, suffice it to state that it is well settled law that two or three documents may be read together for the purpose of determining whether a partnership existed as between the partners. It is true that the shares are not specifically mentioned in the partnership deed dated September 29, 1972. But in the absence of any such specification, the Tribunal was justified in holding that the partners had equal shares. There is, in our opinion, no infirmity or illegality in granting registration for the assessment year 1973-74 and continuation for 1974-75.

6. In the result, we answer the question in the affirmative and against the Revenue.


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