COMMISSIONER OF INCOME TAX Vs. SITARAM BHAGWANDAS

JUDGEMENT

(1.) IN this reference under Section 256(1) of the INcome-tax Act, 1961 (hereinafter referred to as "the Act"), the INcome-tax Appellate Tribunal, Patna Bench, has submitted a statement of the case and referred the following question of law for the opinion of this court:

(2.) THE assessee was a registered firm. For the assessment year 1962-63, it filed a return of its income on the 11th of February, 1963, but before the assessment was made, it submitted a declaration under Section 184(7) of the Act on the 27th of November, 1966, for the continuation of the registration for the previous year. THE Income-tax Officer assessed the assessee as an unregistered firm on the ground that the declaration under Section 184(7) was filed late and not along with the return. THErefore, the final assessment of the assessee was made by the assessing officer by treating it as an unregistered firm and not allowing renewal to it on the belated submission of the declaration in due form. THE assessee preferred an appeal before the Appellate Assistant Commissioner who refused to interfere holding that no appeal lay before, him against the order of refusal passed by the Income-tax Officer, THE Appellate Assistant Commissioner also held that the word "status" did not cover this aspect of the matter and that, therefore, keeping in view the provisions of Section 246 of the Act, the appeal before him could not be entertained. THE assessee then preferred a second appeal before the Appellate Tribunal. THE Tribunal while deciding in favour of the assessee held that the appeal was maintainable also in the matter concerning the status of the assessee and further that renewal could not be refused merely because the declaration in due form had not been literally submitted along with the return filed by the assessee. THE Tribunal held :

(3.) IN this context I shall first refer to the necessary legislative changes in the provision with regard to the renewal of registration as it stood before the 1961 Act came into force and as it stood in the Act before the Amendment Act, 1970. Under Section 26A of the INdian INcome-tax Act, 1922, registration of a firm was a ceremony to be performed every year. Although registration was granted to a firm in a year it was required to apply for renewal every year and the procedure for such renewal was not much different from the procedure adopted for the original registration itself. By the 1961 Act the statutory provision was so altered that where registration had already been granted to any firm for any assessment year it was to have effect for every subsequent assessment year and all that the assessee was enjoined to do was to submit a declaration in the prescribed form stating that there had been no change in the constitution of the firm or the shares of the partners on the fulfilment of which requirement renewal was to be granted as a matter of course. As has been observed in a Bench decision of this court, to which I was a party, in the case of S.P. Pandey v. Commissioner of INcome-tax, [1974] 96 ITR 515, 521 (Pat):