220 WT JEYEWARDENK O. J.—EbraHimjce v. Commissioner of Income Tax
1949Present:Wijeyewardene C.J. and Nagalingam J.EBRAHIMJEE, Appellant, and COMMISSIOlSrER OF INCOMETAX, Respondent
Ik the Matter of a Case stated under Section 74 of theIncome Tax Ordinance (Cap. 188)
8. C. 162—Income Tax Appeal
Income Tax Ordinance—Taxation of business—Father and sorts in partnership—Minority of sons—No bar to partnership—Section 74.
The minority of a partner is no bar to the existence of a partnership.C*ASE stated under section 74 of the Income Tax Ordinance.
H. V. Perera, K.C., with Cyril E. 8. Perera, for the appellant.
H. W. R. Weerasuriya, Croton Counsel, for the Crown.
Cur. adv. vult.
January 17, 1949. Wijeyewardene C.J.—
This is an appeal under section 74 of the Income Tax Ordinance.
The Board of Review upheld the finding of the Commissioner that theappellant was the sole proprietor of the business carried on under thename of A. M. Esufali & Co. and that there was no partnership existingbetween the appellant, his wife and sons in regard to that business.
The appellant relied on a number of circumstances to prove theexistence of a partnership, to wit, the registration of the partners underthe Business Names Ordinance, the institution of actions for and againstthe firm in the names of the partners, the fact that the account of A. M.Esufali & Co. in the Mercantile Bank was operated on by the allegedpartners and that accounts had been opened in the books for theappellant’s wife and sons and each year a certain share of the profitshad been credited to each of these accounts.
The King v. Sgthasivcvm-
The appellant’s Counsel contended that the sole reason why the Boardrefused to “ consider any of these factors conclusive as to the existence ofa partnership ” was the fact that the appellant’s sons were minors, i.e.,young men under the age of twenty-one years. The Crown Counselwho appeared for the Commissioner was unable to invite our attentionto any other reason given by the Board.
The Board has misdirected itself on a question of law. The minorityof a partner is no bar to the existence of a partnership. No doubt aminor is not bound by a contract of partnership made by him during hisminority. But, if he agrees with adults to be their partner and subse-quently on behalf of the partnership enters into 'contracts with thirdpersons, those contracts bind his adult partners and they are entitled toinsist that the partnership assets shall be applied in payment of thepartnership liabilities before he receives anything. [Halsbury’s Laws ofEngland, Volume 22, Para 30; see also Idndley on Partnership (ninthedition), pages 96—98, and Nctgoor Meera v. Meera Saibo ]
I annul the assessment determined by the Board and direct the caseto be remitted for an assessment to be made on the footing that therewas a partnership as alleged by the appellant.
The appellant is awarded his costs in this Court and is declaredentitled to receive the fee paid by him under section 74 (1).
N iGAUNGAM J.—I agree.
EBRAHIMJEE, Appellent and COMMISSIONER OF INCOME TAX, Respondent