Since above appeals relate to same assessee and also involve common contention, they are disposed of by this consolidated order for sake of convenience. 2. assessee is assessed as individual on her share from various firms and interest, etc. Her minor daughter, Kin. Vandana Kapoor, was admitted to benefits of partnership, in firm of Kanpur Textile Agents with effect f r o m 22-6-1974 under deed of partnership dated 31-7-1974. She had deposited sum of Rs. 101 on 22-6-1974. Subsequently she made another deposit of Rs. 3,500 on 14-3-1975. There were various other deposits in her account as also withdrawals in different years. In present appeals, we are concerned with assessment years 1978-79 to 1980-81. In these years, she was credited with profit as well as interest from Kanpur Textile Agents. 3. ITO brought to tax both share and interest falling to Vandana Kapoor from aforesaid firm in assessments of assessee of above assessment years under section 64(1)(iii) of Income-tax Act, 1961 (' Act '). This section lays down that in computing total income of any individual, there shall be included all such income as arises directly or indirectly to minor child of such individual from admission of minor to benefits of partnership in firm. It was submitted before ITO that interest falling to share of Vandana Kapoor could not be assessed under above section and that it was only her share from Kanpur Textile Agents which could be so assessed. ITO rejected this contention in all years observing that share of partner included interest, salary and other remuneration, etc. 4. assessee appealed to AAC. latter passed consolidated order on 15-12-1982. He dismissed assessee's appeals with following observations: " 4. I have considered facts and I find that matter regarding clubbing of interest earned by minor has been decided by different High Courts in different ways. However, there is no direct judgment of Allahabad High Court and I am of opinion that minor once admitted to benefits of partnership has all rights and liabilities except for sharing losses. share of minor is to be taken as share of major partner and share will include interest, salary, bonus, etc., earned by him. In view of specific provisions of section 67 of Income-tax Act, Income-tax Officer was justified in clubbing interest earned by minor on deposits and orders of Income-tax Officer for all three years are confirmed. appeals are dismissed." 5. assessee subsequently moved application under section 154 of Act with AAC contending that he had failed to notice decision of Allahabad High Court in case of CIT v. Smt. Triveni Devi [1971] 81 ITR 511, which constituted mistake apparent from record requiring rectification. 6. AAC passed order under section 154 on 14-3-1983. Following another order of Allahabad High Court itself in case of Kaladhar Prasad Chaturvedi v. CIT [1971] 82 ITR 713, he held that interest earned by Vandana Kapoor from firm of Kanpur Textile Agents could not be assessed in assessments of assessee for assessment years 1979-80 and 1980-81. He, accordingly, allowed assessee's appeals for these years. He, however, held that similar benefit could not be allowed to assessee in assessment year 1978-79 for which her appeal was dismissed. 7. Against above order of AAC passed on 14-3-1983, department has filed appeals for assessment years 1979-80 and 1980-81. On other hand, assessee has filed appeals for all above three years against original order of AAC dated 15-12-1982. 8. Since issue involved is common and is one of law, we will deal with it in consolidated form. question for consideration is whether on facts and in circumstances of present case, interest earned by Vandana Kapoor from firm of Kanpur Textile Agents could be said to be income arising directly or indirectly to her from her admission to benefits of partnership in firm of Kanpur Textile Agents. As already stated above, above firm constituted under deed of partnership dated 31-7-1974. In this deed, there was no stipulation regarding contribution of capital by partners. Subsequently, however, agreements were entered into between above firm and guardian of Vandana Kapoor to effect that any amount brought in by girl would be treated as her deposit with firm which shall bear interest at rate of 15 per cent per annum. It was further agreed that profit credited to account of Vandana Kapoor shall also be treated as her deposit and shall bear interest at rate of 15 per cent per annum. We will, in particular, refer to agreement dated 28-12-1976, which according to learned counsel for assessee, was applicable to assessment year 1978-79. 9. new deed of partnership was executed on 1-4-1978 regarding constitution of Kanpur Textile Agents. In this deed, following two clauses are relevant: " 5. That capital required for partnership business shall be arranged contributed by partners in such proportion and in such manner as may be mutually agreed upon between them from time to time. 6. Interest at 15 per cent per annum shall be allowed or charged on balances in partners' capital accounts. amount brought in by minors and their share of profit credited to their accounts in firm shall be treated as deposits and carry interest at above rate." 10. effect of above documents is that so far as assessment year 1978-79 is concerned, capital and accumulated profit standing in account of Vandana Kapoor were treated as her deposit, as per agreement dated 28-12-1976. It may be relevant to mention here that similar agreements were also entered into subsequently on 5-11-1977 and 20-11-1978 which, in case of any doubt, will certainly cover assessment year 1978-79. So far as other two years are concerned, position is covered by partnership deed dated 1-4-1978 referred to above. 11. question now for our consideration is whether, on facts and in circumstances stated above, interest income falling to Vandana Kapoor either on her deposits or on accumulated profits in Kanpur Textile Agents could be treated as income arising directly or indirectly from her admission to benefits of partnership in aforesaid firm. To find answer to this question, we will have to refer to certain authorities. issue had first come up for consideration of Supreme Court in case of S. Srinivasan v. CIT [1967] 63 ITR 273. In this case appellant was senior partner in firm in which his wife and stranger were partners and his two minor sons were admitted to benefits of partnership. One of clauses of deed of partnership provided that ' if firm requires any sum for meeting expenses for its management and if any of partners has and is willing to give such amount, he may advance (such amount) as loan. He may receive interest for such sum at rate of 12 per cent per annum.' For number of years up to previous year relevant to assessment year 1957-58, shares of profits of wife and minor sons were allowed to accumulate without interest. With effect from that previous year firm decided to allow 9 per cent interest per annum on these accumulated profits. question was whether interest so allowed was assessable in hands of appellant under section 16(3)(a)(i) and (ii) of Indian Income-tax Act, 1922. It w s held that interest accrued to wife and minor sons at least indirectly because of their capacity mentioned in section 16(3)(a)(i) and (ii) and was, therefore, assessable in appellant's hands. 12. Supreme Court also observed that cases where interest was earned on deposit or loan differed from cases where interest was earned on accumulated profits arising from firm itself. In this connection, it will be relevant to refer to observations of Supreme Court as appearing in S. Srinivasan's case as under: ". . . It appears to us that these accumulated profits remaining in hands of firm cannot, on any principle, be equated with deposits made or loans advanced. profits accumulated to credit of wife and minor sons, because they did not draw their share of profits when distribution of profits took place, and allowed those profits to remain with firm; but there is no suggestion at all that, at that stage, either wife or minor sons, or anyone on their behalf, purported to enter into arrangement with firm to keep these accumulated profits as deposits ...... " 13. In other words, Court held that if agreement would have been entered into with firm to keep accumulated profits as deposits, situation would have been different. This was exception provided by Hon'ble Court. assessee's case for assessment year 1978-79 falls within this exception. We have already stated above that there was agreement between Kanpur Textile Agents and guardian of assessee to keep her accumulated profits in firm as her deposits. This principle was also accepted by Allahabad High Court in case of Kaladhar Prasad Chaturvedi. Court observed at page 716 of report that decision in case of S. Srinivasan implied that in case circumstances of case justified conclusion that interest was earned by minor on deposit made by him, same could not be included in income of father under section 64. Court further observed that observations made in above case showed that it was open to parties to agree to treat accumulated profits as loan. We, therefore, hold that interest earned by Vandana Kapoor could not be included in assessment of assessee under section 64(1)(iii) in assessment year 1978-79. 14. issue in subsequent two years is directly governed by decision of Allahabad High Court in Kaladhar Prasad Chaturvedi's case. As already stated above, Court held following S. Srinivasan's case that that decision implied that in case circumstances of case justified conclusion that interest was earned by minor on deposit made by him, same could not be included in income of father under section 64. In present case, partnership deed dated 1-4-1978 clearly stated that amount brought in by minors including Vandana Kapoor and their share of profit credited to their accounts in firm were to be treated as deposits. Such interest could not, therefore, be included in assessment of assessee under section 64(1)(iii). above findings are also supported by decision of Allahabad High Court in case of Smt. Triveni Devi. 15. In result, while assessee's appeal for assessment year 1978-79 is allowed, those by department for assessment years 1979-80 and 1980-81 are dismissed. assessee's appeals for assessment years 1979-80 and 1980-81 having been infructuous in view of order of AAC passed under section 154 on 14-3-1983 are also dismissed. *** SMT. PUSHPA KAPOOR v. INCOME TAX OFFICER