Law:

Section:

Section 184 of the Income-tax Act, 1961 - Firm - Registration - Entitlement to - Whether assessee - firm could be granted registration even when its partnership deed curtailed power of two of the partners to terminate the partnership and seek dissolution and gave them only right to take amounts outstanding to their credit - Held, yes Facts The assessee a partnership firm filed an application of grant of registration. A |clause in its partnership deed stated that if two of the partners intended to retire from the business they could take only the amount outstanding to their credit at the time of retirement and had no right to force a dissolution of the firm. The revenue refused to grant registration on the basis of this clause. On appeal, the Tribunal, however granted the registration. On reference: Held The impugned clause in the partnership deed could not be said to be invalid. Parties were entitled to contract in above terms. There was no dispute as to the genuineness of the firm. Therefore, the Tribunal was justified in granting registration to the firm. K. Srinivasan and H. Raghavendra Rao for the Applicant. S.G. Shivaram for the Respondent. ORDER Shetty, Actg, CJ. - This is a reference under section 256(1) of the Income-tax Act, 1961 ('the Act'). Question referred for opinion of this Court is: "Whether, on the facts and in the circumstances of the case, the Income-tax Appellate Tribunal is right in law in granting…

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