Law: Income Tax Act, 1922

Section: 23(5)(b),26A,28

Law: Income Tax Rules, 1922

Section: 2,6B

Income-tax Act, 1922 -Sections 23(5)(b), 26A, 28 -- Income-tax Rules, 1922 -Rules 2, 6B -- Partnership -Registration -Partnership deed executed sometime after commencement of accounting year -Deed given effect from commencement of accounting year -Registration, whether allowable from the date of execution of the deed -Held yes -'Constituted by', meaning of -Income-tax Rules, Rules No. 2 to 6B -- Central Board of Revenue -Circular No. 8 of 1957, dated 26th April 1957 giving retrospective effect to a deed for more than six months -'Course pursued by Board', whether correct -Held yes -- Registration of firm -Words and Phrases -"Constituted by" -Expression means, firm must have been " set up " or "established" "by" deed -Such "setting up" must be in the relevant accounting year -Registration effective from date of deed -Registration to be refused for period antecedent to date of deed in the accounting year -No question of liberal interpretation of section 26-A (by Fazle-Akbar and Hamoodur Rahaman, JJ., Cornelius, C. J., being of the view that registration should be extended to such antecedent period if firm was genuinely in existence during such period if, determining date of commencement of firm being a binding duty of Income-tax Officer) -Circular of Central Board of Revenue, departing from provision of statute -"Course pursued by Board seems to be correct" -- Corresponding Sections: Income-tax Ordinance, 1979 -Section 68(1) -- JUDGMENT {CORNELIUS C.J.}---I have had the advantage of reading the judgment proposed to be delivered by my learned brother, Fazle-Akbar J. I agree generally with his examination and analysis of the relevant law and the authorities. I am clear in my mind that the expression "constituted by" is more specific and has a more direct connnotation than the expression 'constituted under.' Section 26A required the existence of an instrument by which the alleged partnership was constituted, and giving the words in sub-section (1) their full value, it may indeed appear that a mere record of the earlier formation of a partnership will not meet the…