COMMISSIONER OF INCOME TAX Vs. DELHI COLONIZERS

JUDGEMENT

(1.) THE following question has ben referred to us for the asst. year 1970 -71 :

(2.) THE firm in question had four partners and an application for registration of the firm was filed in Form No. 11, which was signed by only two partners. Shri Chander Singh, one of the partners, had signed on behalf of the remaining two partners. The ITO pointed out the defect as a result of which one of the partners signed the form but the fourth partner did not sign. It was claimed that there was a dispute amongst the partners and the fourth partner was not -cooperating with the assessee - firm. An attempt was made to persuade the ITO to issue summons to produce the fourth partner but the ITO did not call him. As a result, the registration was refused.

(3.) ON further appeal to the Tribunal, it was held that the ITO was wrong in rejecting the request of the assessee to summon the fourth partner, Rameshwar Parshad, under S. 131 of the INCOME TAX ACT, 1961, and a reference was also made to S. 185(3) which gives power to reject or accept the application for registration of the firm. In the result, the Tribunal held that when the authorities were satisfied with the genuineness of the firm, the question of refusing registration to the firm did not arise.