COMMISSIONER OF INCOME TAX Vs. B NARASIMHA RAO

JUDGEMENT

(1.) THE Commissioner of Income-tax, Andhra Pradesh-I, Hyderabad, required the Income-tax Appellate Tribunal, Hyderabad Bench "A", to refer the following common question, said to be a question of law arising out of the Tribunal's order dated April 9, 1991, in I. T. A. Nos. 194 to 202/Hyd of 1988, for the opinion of this court :

(2.) MASTER Rajesh Kumar and MASTER Kartik Kumar, minor sons of B. Narasimha Rao, have been admitted to the benefits of partnership in the firm of B. Rajesh and Company, Hyderabad. The said B. Narasimha Rao and his two minor children were, at the relevant time, residing in United States of America and treated as "non-residents" for the purpose of the Indian Income-tax Act, 1922.

(3.) THE Tribunal relied upon Section 182(3) of the Act and came to the conclusion that if any of the partners of the firm is a non-resident, the assessment is to be made on the firm and the tax recovered from the firm itself. THE Tribunal, relying upon Section 2(23) of the Act, came to the conclusion that the minor who has been admitted to the benefits of partnership is also to be treated as a partner. THE Tribunal by reading the said two provisions together came to the conclusion that in the case of a non-resident minor partner, the assessment has to be made on the firm and tax also has to be recovered from the firm itself.