BHASKAR AND CO Vs. COMMISSIONER OF INCOME TAX

JUDGEMENT

(1.) The connected appeals are filed by the assessee challenging the orders of the Income tax Appellate Tribunal, Cochin Bench, wherein the denial of status claimed by the assessee as a 'firm' by the assessing officer is confirmed by the Tribunal for the assessment years 1993-94 and 1994-95. We have heard learned counsel appearing for the appellant and Standing Counsel Sri Jose Joseph, who took notice on admission.

(2.) The assessee was being assessed as a registered firm until the assessment year 1992-93. From 1-4-1993 onwards, major amendments were introduced in chapter XVI of the Income Tax Act dispensing with registration of firms for the purpose of assessment under the Act. Newly substituted provisions of Sec.184 introduced with effect from 1-4-1993 is extracted herein below for easy reference:

(3.) Admittedly, the assessee was assessed as a registered firm upto the assessment year 1992-93 and it was again assessed as a firm during the year 1995-96. However, in between for the two assessment years, 1993-94 and 1994-95, the assessee was declined the status as a 'firm' for the purpose of assessment for the reason that it did not attach certified copy of the instrument of partnership along with income tax return filed for these two years. When appeals are heard by the C. I. T. (A), the argument of the assessee was that for the assessment years 1992-93 and 1995-96, the firm was assessed in that status and non-filing of the certified copy of the instrument of partnership along with returns was a bona fide omission and the same was made up by producing it before the Officer when assessments were taken up. The C. I. T. (A) directed the assessing officer to make assessment as a 'firm' granting eligible deduction, otherwise declined under Sec.185 of the Act, against which the Department filed appeals before the Tribunal. The Tribunal held that since the assessee failed to produce certified copy of the instrument of partnership along with the return for both the years and since there is no evidence about the production of the same at the time of assessment, the original assessment issued declining status and making disallowance of the claims of deduction towards the payment of interest, salary, bonus, commission, remuneration etc. to partners is perfectly in order. It is against the order of the Tribunal, assessee has come up with these appeals before us.