3. ID.; ID.; ADMISSION OF ADDITIONAL PARTNERS. — The admission of Y.S., H. Sh. N. and U. Q.

as additional partners in the firm under the

circumstances mentioned in the decision did not have the effect of dissolving the duly registered general partnership of Y. Y. & Co. and of
creating a new unregistered copartnership for the interval between February 21, 1924, and July 11, 1927.

4. ID.; ID.; PROVISIONS OF THE CODE OF COMMERCE CONSTRUED TOGETHER. — Articles 24 and 25 of the Code of Commerce, construed
together, plainly contemplate the continued existence of the association in the manner and form in which it appears in the Mercantile Register
regardless of the unregistered changes therein. Article 25 specifically provides in its last paragraph the consequences of the omission to
register the resolutions or acts of a mercantile association which modify or alter the conditions of the recorded articles of association.

GR No. L-42115 March 30, 1935

TEC BI & COMPANY, INC., Plaintiff-appellant,
vs.
THE COLLECTOR OF INTERNAL REVENUE, defendant-appellant.

Facts:
A regular collective commercial society called "Tec Bi y Compañia" was organized in this city of Manila, of which the late Yu Hiang Co was one
of the collective partners and whose society was duly registered in the Mercantile Registry.

Partner Yu Hiang Co. having died during the social period, in accordance with the terms of paragraph XVII of the aforementioned corporate
deed, which says:

"XVII. In the event that a partner dies in China or in another territory that is not included within the jurisdiction of the
Philippine Islands, his legal heirs must, within one month after the deceased partner's death, write a letter to the Society stating that
its deceased, partner of this Society has died and authorizing any of his heirs to succeed him in the rights and actions of the
deceased. " And the company having been duly notified of this fact, it recognized Yu Yiong as the successor of the late Yu Hiang Co in
the aforementioned company called Tec Bi y Compañia.

On November 1, 1921, Yu Yiong transferred to his brother Tee Huan alias Yu Siong a stake in the sum of P9,011.23 in the relict capital of his
late father in the Yu Yiong company and Company. The company was reorganized under the collective name of Yu Yiong and Company, whose
deed was registered on November 12, 1920, and it is recorded in said deed that after the partner Yu Hiang Co. was replaced by his heir Yu
Yiong.

Partners of Yu Yiong and Company in a public deed granted before the public notary and recognized and admitted Tee Huan alias Yu Siong the
brother of Yu Yiong and the so-called Heng Shiu Nian alias Ang Shiu Lian as partners of the company Yu Yiong and Company. Ang Shiu Lian was
absent from the Philippine Islands and was therefore unable to sign the document. However, Ang Shiu Lian executed a separate document
agreeing to the deed.

The Collector of Internal Revenue argued that the association Yu Yiong and Company ceased to be a registered general copartnership during
the years 1921 to 1927 inclusive for the purposes of the income tax law because the copartnership failed to register until July 11, 1927.

Issue: Whether or not the admission of Yu Siong, Heng Shiu Nian and Uy Quioco as additional partners in the firm under the circumstances
mentioned, have the effect of dissolving the duly registered general partnership of Yu Yiong and Company and of creating a new unregistered
copartnership

Held:
No. The admission of Y.S., H. Sh. N. and U. Q. as additional partners in the firm under the circumstances mentioned in the decision did not have
the effect of dissolving the duly registered general partnership of Y. Y. & Co. and of creating a new unregistered copartnership for the interval
between February 21, 1924, and July 11, 1927.

First, there is no provision in the Code of Commerce that such a conversion should take place. Second, there is no provision in the Code of
Commerce that the registration of the transfers in the Mercantile Register on July 11, 1927, should have the effect of reviving or recreating the
alleged extinct registered general copartnership of Yu Yiong and Company. Third, articles 24 and 25 of the Code of Commerce, construed
together, plainly contemplate the continued existence of the association in the manner and form in which it appears in the Mercantile Register
regardless of the unregistered changes therein. Article 25 specifically provides in its last paragraph the consequences of the omission to
register the resolutions or acts of a mercantile association which modify or alter the conditions of the recorded articles of association; that is to
say, any changes not so registered are binding between the members of the association but shall not prejudice third persons, who, on the
other hand, may avail themselves thereof insofar as it may be advantageous to them.