COMMISSIONER OF INCOME TAX Vs. HANSA AGENCIES

JUDGEMENT

(1.) IN this reference we are concerned with two assessees, but the question referred to us is a common question and does not depend for its answer on the various facts involved in the assessments of the two assessees before us. The common question referred to us for our opinion at the instance of the Commissioner under S. 256(1) of the IT Act, 1961, reads as follows:

(2.) BY an order dt. 29th March, 1967, which was for the asst. year 1962 63, the ITO completed the assessment of the said firm determining its total income at Rs. 90,262 and observing further in the assessment order that the said firm was to be assessed as an unregistered firm. It had been granted registration for 1961 62. On 14th May, 1962, the said assessee had made an application for renewal of registration under S. 26A of the Indian IT Act, 1922, for the year under consideration. On 27th June, 1962, it had made an application in Form No. 11 prescribed under the Rules. By his order of the very same date, i.e., 29th March, 1967, the very same officer, viz., 13th ITO, B.S.D. (W), Bombay, declined to grant renewal/continuation of registration of the assessee firm. Both the orders of the ITO, dt. 29th March, 1967 are annexed as Annexure 'A' to the statement of case.

(3.) THE aggrieved assessee then preferred a further appeal to the Tribunal. In the said appeal, the assessee objected to the order of the AAC confirming the order of the ITO declining to grant renewal/continuation of registration of the assessee firm. The assessee further objected to the AAC not hearing and disposing of the assessee's objection in the appeal relating to the computation of its total income. It may be mentioned that the similar position existed for the other assessee viz., M/s. Hansa Agencies, and both the appeals were heard together by the Tribunal. Before the Tribunal it was submitted that the AAC had clearly erred in holding that a common appeal was not tenable. It was urged as a sequitur that the Tribunal should direct the AAC to hear and decide the objections raised by the assessee firm against the computation of its income. In the alternative, learned counsel for the assessee contended that the assessee should be permitted to deconsolidate the two appeals by filing two separate memos of appeals, one containing objections against the computation of income and the other containing objections against the order refusing renewal/continuation of registration. It was prayed that the delay in filing such separate appeals, assuming that any delay had taken place, should be condoned. The Tribunal accepted the submissions made by the assessee, viz., that one composite appeal was permissible, and accordingly directed the AAC to hear the assessee on the question of computation of income which the AAC had not gone into in the view he had taken of the maintainability of a composite appeal. After giving this direction the Tribunal has observed in para 10 of its appellate order (in M/s. J.K. Shah & Co.'s case) that even if its view had been that a composite appeal is not tenable, it would have accepted the suggestion made by counsel for the assessee to permit the assessee to file two separate memos of the appeals and to condone the delay in filing the same. It is from this order of the Tribunal and a similar order in the allied appeal by M/s. Hansa Agencies that the reference has been made to the High Court.