AIR 1966 MADHYA PRADESH 13 ::(1966) 59 ITR 364 ::1965 MPLJ 644 ::1967 JabLJ 641

Madhya Pradesh High Court

Hon'ble Judge(s): P. V. Dixit , C.J. AND K. L. Pandey , J

Income-Tax Act (11 of 1922) , S.26A— Registration of firm - Motor transport business carried on by partnership on strength of permit obtained by partner and with vehicle belonging to such partner - There it no violation of S.34 and S.9(2) of Motor Vehicles Act nor of S.23 Contract Act - Firm was entitled to registration u/S.26A. @page-MP14 Partnership business in transport by motor can be carried on, on the strength of a permit obtained by a partner and with a vehicle belonging to him. The partnership business can also be carried in with vehicles belonging to the partnership firm on the basis of permits obtained by a partner in respect of these vehicles, because a partner though not owner of those vehicles is clearly in possession of those vehicles. There is nothing in the Motor Vehicles Act laying down that transport business in partnership can only be done on permits issued and obtained by the firm itself and with vehicles of which the firm is the owner. It cannot, therefore, be said when transport business is carried on with vehicles belonging to a partner or to the firm on the authorisation of permits held by a partner, that Sections 31, 42 and 59 of the Motor Vehicles Act are transgressed. There being thus no violation of any provision of the Motor Vehicles Act, the partnership firm cannot be regarded as illegal in such a case. Such a par....