COMMISSIONER OF INCOME-TAX, MADHYA PRADESH vs SIR HUKUMCHAND MANNALAL & CO.

The Supreme Court held that under Section 26A of the Income-tax Act, 1922, a partnership can be registered even if two partners represent the same beneficial interest of a Hindu undivided family (H.U.F.). The Court clarified that the Indian Contract Act does not impose any disability on H.U.F. members regarding contracts inter se or with third parties. The appeal was dismissed, affirming the High Court's decision to grant registration to the firm in question.