COMMISSIONER OF INCOME TAX Vs. MANURAM BABULAL

JUDGEMENT

(1.) IN this reference under Section 256(1) of the INcome-tax Act, 1961 (hereinafter referred to as the "Act"), we are concerned with the assessment year 1972-73. The assessee is a partnership firm. It has been registered in terms of Section 185 of the Act. IN regard to the assessment year 1972-73, it was required to submit its return of income as well as declaration in terms of Section 184(7) by June 30, 1972. The declaration and the return of income were filed on September 21, 1973. Notice for the assessment proceeding was issued to the assessee. IN the course of the assessment proceeding, the INcome-tax Officer refused continuation of registration to the firm. He, therefore, treated it as an unregistered firm and passed assessment order accordingly.

(2.) THE assessee being aggrieved by the order of the Income-tax Officer refusing continuation of the status of a registered firm as also against the quantum of assessment filed an appeal before the Appellate Assistant Commissioner. THE latter held that the (renewal of) registration had been wrongly refused to the assessee. He, therefore, set aside that part of the order of the Income-tax Officer by which the status of the assessee had been taken as that of an unregistered firm. THE Department being aggrieved by the order of the Appellate Assistant Commissioner moved the Appellate Tribunal but without any success. Hence, the present reference before us at the instance of the Department.

(3.) LEARNED senior standing counsel submitted that the view propounded by Jha J. in the case of Madhur Jalpan [1983] 143 ITR 351 (Pat) would render the provision of Section 246(j) redundant, inasmuch as Clause (c) would cover all cases of determination of status. This submission was advanced before Jha J. as well. It did not find favour with his Lordship nor does it find favour with us. We are thus in full agreement with the views expressed by Jha J. in the case of Madhur falpan [1983] 143 ITR 351 (Pat). We are unable to find any reason for differing from the views propounded therein. In our view, therefore, the Appellate Assistant Commissioner had the jurisdiction to entertain the appeal of the assessee.