KASHI NATH MUKUND LAL Vs. INCOME TAX OFFICER

JUDGEMENT

(1.) AGGRIEVED against order dated 24th September, 1977, of the ITO refusing to renew registration under Section 184 of the I.T, Act for assessment year 1975-76 and the orders dated 4th February, 1978, and 15th September, 1978, passed by the AAC and CIT, the petitioner has approached this court for the quashing of these orders and for direction to opposite parties to grant continuation of registration to the petitioner's firm for the year in dispute.

(2.) IT is not disputed that in the previous years relevant to the assessment year 1973-74 there was change in the constitution of the firm and a fresh deed of partnership was drawn up and the application for fresh registration was granted by the ITO. IT was continued in 1974-75. In 1975-76 also, the petitioner filed requisite Form No. 12 seeking continuation of registration under Section 184(7} of the Act on 2nd June, 1975. IT is further not disputed that the form was duly signed by all the partners constituting the firm. IT was filed in time containing declaration that business was same and there was no change in share. The ITO, however, rejected the application and found Form No. 12 of 1975-76 to be invalid for three reasons. According to him the form was shown to have been dated 31st May, 1975, and it was filed on 2nd June, 1975, when partners of the firm resided at distant places like Bombay, Punjab, Kanpur, Allahabad and Varanasi, etc. From this he inferred that the form could not have been signed between these two days, namely, 31st May and 2nd June. He further drew an inference that the blank form was not signed by the partners prior to 31st May without mentioning the name of the firm, year or date, etc. Second defect noticed by him was that the form on which the petitioner had applied for continuance of registration was printed on 5th November, 1971. Form for earlier year was also printed on the same date. He found that the signature of partners in both the years were in the same sequence and virtually in the same pen and ink. Therefore, according to him, the forms for both the years 1974-75 and 1975-76 were signed by the partners at the same time. Lastly, signatures have been obtained on a blank form with a view to avoid delay in obtaining signatures of partners residing at different and distant places. Declaration made under Section 184(7) signed by partners before the end of the accounting year was not valid. Appeal against this order was not entertained by AAC as the order refusing to grant renewal of registration was an order under Section 185(3) against which separate appeal lay under Section 246(1) of the Act. Against the appellate order and the order refusing to grant registration, the petitioner filed two separate applications under Section 264 of the Act before the Commissioner who also upheld the order of the ITO on merits.

(3.) IN the result this petition succeeds and is allowed. The orders passed by opposite parties Nos. 1 to 3 are quashed. A direction is further issued to the ITO, A ward, Fatehgarh, to grant registration to the petitioner in accordance with law. The petitioner shall be entitled to its costs.