N.D. Raghavan, Judicial Member - (1.) THIS is an appeal of the assessee against the order dated 7-2-1986 of the Appellate Assistant Commissioner of Income-tax on the effective ground that the Tribunal may be pleased to condone the delay of nearly two months in filing the form for registration and direct the grant of registration which the Appellate Assistant Commissioner has failed to do.
(2.) The facts of the case are briefly these M/s. Padmasri Rice Mill originally came into existence through a deed of partnership dated 11-9-1979 consisting of six partners including two minors admitted to the benefits of partnership. The assessee firm was granted registration for the first time for the assessment year 1981-82. A fresh deed of partnership was again executed on 20-2-1981, as one of the minors became major electing to become a partner of the firm. This deed of partnership along with Form Nos. 11 & 11A were filed before the assessing officer on 28-3-1981 seeking registration of the firm for the assessment year 1982-83. The firm as reconstituted was granted continuation of registration for the assessment year 1983-84. There was again a change in the constitution of the firm during the course of the accounting year relevant to the assessment year 1984-85 as one of the partners retired from the firm as per the retirement deed dated 10-9-1982. The firm closed its books of accounts on 10-9-1983. Form Nos. 11 & 11A along with the deed of partnership in original were received from the assessee on 5-11-1983. Thus there was a delay of two months in submitting the application for registration. The assessing officer refused to accept the explanation submitted by the assessee for condoning the delay and passed order under Section 184(4) of the Income-tax Act rejecting the request. On appeal it was dismissed by the Appellate Assistant Commissioner as not maintainable under Section 246 of the Act. The order dated 7-2-1986 was served upon the assessee on 19-2-1986. Subsequently the assessment was reopened by issue of notice dated 4-4-1986 under Section 148 of the Act which resulted consequently in determination of the total income at Rs. 1,36,790. It resulted in a tax demand of Rs. 76,869 for which demand was raised by the assessment order dated 22-3-1989. Immediately thereafter the firm submitted the present appeal before the Tribunal on 3-4-1989. The learned representative for the assessee submitted that : The orders of the authorities below are contrary to law, facts of the case, probabilities of the circumstances and weight of evidence. Genuineness of the firm was never doubted by the assessing officer. Refusal to grant registration is only on account of delay in submitting the application for registration. As a matter of fact, the firm was granted registration for the earlier years, It had undergone a change in its constitution due to retirement of one of the partners in the earlier firm. This change in the constitution of the firm was brought about at the beginning of the previous year relevant to the assessment year under appeal. Banking authorities had granted a term loan on the security of the assets of the firm. Partnership deeds were considered as title deeds and were retained with the bank. The assessee came to know of the situation after close of the previous year. Consequently he rushed to the bank for claiming return of the partnership deed. He submitted the application for registration late by nearly two months only. The authorities below should have considered the assessee's situation and accepted its explanation for condoning the delay to grant registration to the firm. The appellate officer has not disposed of the appeal on merits and directed the assessing officer to condone the delay and grant registration. The view taken by the appellate officer is a short-sighted one. He wrongly took into consideration only the existing facts but did not imagine the future contingencies as has happened in this case. The assessment was reopened under Section 147 and the reassessment resulted in a total income of Rs. 1,36,790 giving rise to tax demand of Rs. 76,869 on the assessee. Hence the delay of nearly two months only has to be condoned and registration of the firm has to be directed to be granted.
(3.) AT the outset before giving reply to the submissions of the assessee on the merits of the appeal, the learned representative for the Revenue strongly raised his preliminary objection on the ground that this appeal itself before the Tribunal was time barred by more than 3 years. The assessee itself has computed the delay in its affidavit filed before the Tribunal as has also been admitted by the registry in 1079 days. Being the delay running to more than 3 years, the appeal is time barred outright and this has to be dismissed in limine. There is no satisfactory explanation for such inordinate and huge delay by the assessee.;