Law:

Section:

Section 185 of the Income-tax Act, 1961 - Firm - Position prior to 1-4-1993 - Assessment year 1968-69 - Minor which had been admitted to benefits of firm, attained majority during relevant accounting year, and, before he could exercise option within given period of six months, year, ended - Whether till end of relevant accounting year, there was no change in constitution of firm and, therefore, firm was entitled to continuance of registration - Held, yes FACTS The minor, who had been admitted to the benefits of the assessee-partnership firm, attained majority on 18-11-1967. On 1-1-1968, a fresh partnership deed, was executed in which the minor, became a fullfledged partner. The relevant accounting period for the assessment year, ended on 31-12-1967. The Tribunal declined to the continuation of registration to the firm holding that there was change in the constitution of the firm. On reference : HELD For purposes of the relevant year, the position was that the minor became major on 18-11-1967, and, before he could exercise the option within the given period of six months, the year ended. The position was that till the end of the year in question, there had been no change in the constitution of the firm. In this view, the firm was entitled to continuance of registration. The Tribunal was in error in holding that there had been a change in the constitution of the firm. Note: The case was decided in favour of the assessee. CASE REVIEW CIT v. Mathura Prasad Annoolal[1978] 115 ITR 372 (All.)followed and relied upon. CASES REFERRED TO CIT v. Mathura Prasad Annoolal [1978] 115 ITR 372 (All.). JUDGMENT…

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