PREM AGENCIES Vs. COMMISSIONER OF INCOME TAX

JUDGEMENT

(1.) THIS reference at the instance of the assessee is under Section 256(1) of the Income-tax Act, 1961, for decision on the following question of law :

(2.) THE relevant assessment year is 1972-73. THE Income-tax Officer rejected the application for registration of the firm coming to the conclusion that no genuine firm has come into existence. THE assessee appealed to the Appellate Assistant Commissioner. THE Appellate Assistant Commissioner took the view that some further enquiry into facts was necessary without which the question of genuineness of the firm could not be decided. Accordingly, the Appellate Assistant Commissioner did not decide the matter on merits and remanded the case to the Income-tax Officer for making a further enquiry as directed. THE Revenue, being aggrieved by the order of remand made by the Appellate Assistant Commissioner, preferred an appeal to the Tribunal. THE grounds of appeal indicate that the only grievance made in the appeal filed to the Tribunal, was against the remand made by the Appellate Assistant Commissioner to the Income-tax Officer. THE relief claimed in the appeal was only to this extent, or, in other words, to set aside the order of remand. THE Tribunal, however, after coming to the conclusion that the remand to the Income-tax Officer was not justified and that the existing material was sufficient to decide the case on merits, proceeded to decide the case itself on merits and held that the refusal of registration was justified. Aggrieved by this decision of the Tribunal instead of remand by the Tribunal to the Appellate Assistant Commissioner for deciding the appeal on merits, this reference has been made at the instance of the assessee.