ANTIQUARTS Vs. COMMISSIONER OF INCOME TAX

JUDGEMENT

(1.) THESE two references in respect of the assessment year 1969-70 are at the instance of the assessee. I.T.R. No. 7 of 1976 is against the order cancelling the registration under Section 186(2) of the I.T. Act, 1961, and I.T.R. No 8 of 1976 is against the order refusing to reopen the best of judgment assessment.

(2.) IN I.T.R. No. 7 of 1976, the question of law referred at the instance of the assessee is :

(3.) A notice under Section 139(2) of the Act was issued on June 2, 1969, calling upon the assessee to file a return within thirty days of receipt of the notice. The same was received by the assessee on June 20, 1969. The assessee filed an application on July 19, 1969, signed by one of the partners requesting time for filing the return till October 31, 1969, on the ground that the accounts had not been finalised. The application was received on July 21, 1969. The record does not show whether the extension of time was granted or not. However, another application dated October 31, 1969, signed by another partner was filed praying for extension of time till January 31, 1970, on the ground that the accounts of Bombay and Bangalore branches have not been finalised. Time was granted till November 30, 1969, and communicated by letter dated November 3, 1969, received by the assessee on November 10, 1969. On November 29, 1969, another application was filed for extension of time till January 31, 1970, on the ground that one of the partners had gone abroad for a business purpose and will take a month to return and that consultation with him was necessary. The ITO issued notice under Section 142(1) on December 4, 1969, calling for the production of accounts and fixing the hearing to December 15, 1969. The receipt of this notice is denied by the assessee. An application dated January 31, 1970, was made praying for extension of time for submitting the return till March 26, 1970, the reason being the same as was alleged in the application dated November 29, 1969. This was rejected, and the assessee was informed by a letter dated February 2, 1970, served on February 7, 1970. The ITO issued a notice dated February 2, 1970, that as no return of income had been filed under Section 139(2) of the Act, he proposed to complete the assessment under Section 144 and also to cancel the registration. This was served on the assessee on February 10, 1970. By its reply dated February 20, 1970, the assessee requested the ITO to grant time till the middle of March, 1970, for submitting the return, the reason being again that the partner had gone abroad and had not yet returned. The officer completed the assessment under Section 144 on February 25, 1970, and, on the same day, he passed the order cancelling the registration under Section 186 of the Act. The assessee, thereafter, filed an application under Section 146 on March 26, 1970. The same was taken up on April 29, 1970. There was no appearance on behalf of the assessee. An authorisation was received in favour of one G. Subramoniam along with a covering letter from the assessee that he was unable to produce the accounts on that day. As Subramoniam had to attend to some domestic function, an adjournment was prayed for. This was declined, and the application under Section 146 was rejected. It was on these facts that the order cancelling the registration and the best of judgment assessment followed.