COMMISSIONER OF INCOME TAX Vs. NARAYAN DAS SATYARANJAN

JUDGEMENT

(1.) THE Tribunal, Cuttack Bench, has drawn up a statement of case under S. 256(1) of the IT Act, 1961 (for short "the Act"), and referred the following questions for the opinion of this Court:

(2.) THE assessee is a partnership firm and the reference relates to the asst. year 1974 75. The assessee filed a declaration under S. 184(7) of the Act in Form No.12 on 20th June, 1974, praying for continuation of the benefits of registration for the asst. year 1974 75. The ITO found that the application was no doubt filed within the prescribed time but it was not signed by all the partners as required under the law, as one of the partners, namely, Dr. S.K. Guha, did not sign the declaration and his signature had been forged by his son, Sri B.K. Guha, another partner of the firm. The finding of the ITO was based on the expert opinion dt. 29th March, 1975, of the Government Examiner of Questioned Documents and the subsequent admission of Sri S.K. Guha. The ITO accordingly issued a show cause letter dt. 17th Jan., 1976, asking the assessee as to why the continuation of the benefits of registration should not be refused on that ground. There was no reply from the assessee. The ITO accordingly held that the declaration filed by the assessee was not just a defective one in terms of S. 185(3), it was not valid in the eye of law and so it was not a true declaration. He, therefore, refused to register the firm on that ground by an order passed under S. 185.

(3.) THE assessee preferred a second appeal before the Tribunal. The Tribunal, after considering the rival submissions and following the decision in the case of New Orissa Traders vs. CIT (1977) 107 ITR 553 (Ori) : TC6R.579, held that the ITO rejected the assessee's declaration on the ground that it was formally defective and so the order passed by him was one under S. 185(3) which is appealable under S. 246(j). The Tribunal, therefore, set aside the order of the AAC and restored the appeal to his file with a direction to entertain the same and dispose of the same afresh in accordance with law after allowing the parties concerned opportunity of being heard.