JOGINDER PALL, A.M.: - (1.) BY this order we shall dispose of this appeal of the assessee filed against the order of the Commissioner (Appeals), Patiala, for the assessment year 1993-94.
(2.) The first effective issue raised in this 'appeal is that the Commissioner (Appeals) 'was not justified in sustaining the order of the assessing officer in' treating the firm'' as an, Association of Person. The facts of the case are that assessee had filed return of income in the status of a registered firm. However, the assessing officer observed that assessee had filed a photocopy of an instrument of partnership certified by only one of the two partners. As per provisions of sub-section (2) of section 184, the assessee was required to furnish a certified copy of the instrument of partnership duly signed by all the partners along with the return of income. The assessing officer, therefore, issued a show-cause notice as to why the assessment should not be completed in the status of an Association of Person. In response, to such show-cause notice, the assessee-immediately filed a certified copy of the partnership deed duly signed by two partners and by relying on the various judgments reported in CIT v. M.N. Ghosh & Sons (1987) 167 ITR 125 (Pat), CIT v. J.B. Coal Traders (1987) 164 ITR 450 (Pat) and Ganga Motor Service v. CIT (1977) 106 ITR 132 (Pat), the assessee contended that benefit of registration could not be denied to the assessee only for such technical default. However, the assessing officer was not impressed with the submissions of the assessee. He was of the view that as per old provisions of section 185(3). of the Income Tax Act, the assessee could be allowed an opportunity to rectify the defect. But as per. the amended provisions, with effect from assessment year 1993-94, the assessing officer has not been given power to ask the assessee to rectify such defect. He further observed that the judgments cited by the assessee were applicable to the old provisions of the Act and not to the present provisions. Accordingly, the assessing officer completed the assessment in the status of an Association of Person. Being aggrieved, the assessee impugned the action of the assessing officer in appeal before learned Commissioner (Appeals). The submissions made before the assessing officer were reiterated. However, learned Commissioner (Appeals) upheld the order of the assessing officer by recording the following findings in para 2.1 of the appellate order : "2.11 have carefully considered the facts of the case and the rival submissions. The appellant-firm was required to file a certified copy of the instrument of partnership signed by all the partners under section 184(2) of the Income Tax Act, 1961. However, the firm has filed an attestdd copy of the instrument of partnership which is signed by one partner only. Thus, the basic condition that the firm should file a certified copy of the instrument of partnership duly certified and signed in original by all the partners of the firm, has not been complied with. Under such circumstances, where a firm does not comply with the provisions of section 184(2) of the Income Tax Act, 1961, the assessment has to be framed as provided in section 185 of the Income Tax Act, 1961. In this section, it has been specifically provided that where a firm does not comply with the provisions of section 184 for any assessment year, the firm shall be assessed for that assessment year in the same manner as an Association of Person, and all the provisions of this Act shall apply accordingly". In the instant case, the firm has not complied with the provisions of section 184(2) of the Income Tax Act, 1961. The assessing officer has complied with the provisions of section 185 and he has assessed the appellant in the status of a firm but assessed in the same manner as an Association of Person. Therefore, the appellant's contention that the assessing officer had changed the status of the firm and assessed them in the status of an Association of Person, is not correct. What the Association of Person has done that he has assessed the appellant as a firm but in the manner as an Association of Person is assessed which is in accordance with the provisions of section 185 of the Income Tax Act, 1961. The case law cited by the appellant is not relevant here as it pertains to the old provisions of section 184 before their amendment by the Direct Tax Laws (Amendment) Act_ 1989. In the new provisions of the Act, there is no provision requiring the assessing officer to give an opportunity to the appellant to rectify the defects, if any, in the instrument of partnership, etc. Therefore, the contention is not acceptable and is dismissed. Therefore, the action of the assessing officer in assessing the appellant as a firm in the manner as an Association of Person as provided under section 185 of the Income Tax Act, 1961, does not require any interference. Appellant's plea on this account is, therefore, dismissed." Assessee is aggrieved by the order of the Commissioner (Appeals) and hence this appeal before us.
(3.) THE learned counsel for the assesspe reiterated the submissions made before the authorities below. He submitted that the assessee had filed a copy of the partnership deed duly certified by one of the two partners along with the return of income. THE only defect was that such copy of instrument of partnership was not certified by both the partners. This defect was only of a technical nature. Ile submitted that immediately on receipt of the show-cause notice, the assessee rectified the defect and furnished a certified copy of the instrument of partnership signed by both the partners. Thus, he contended that the assessee could not have been treated as an Association of Person merely for such technical lapse. He relied on the following judgments : (i) CIT v. Hyderabad Stone Depot & Ors. (1977) 109 ITR 686 (AP)(FB) Where the.High Court has held that non-mentioning of minor's share in losses in column No. 6 of the application filed for registration was a curable defect and hence the assessee was entitled to registration. THE High Court also observed that the intent of the law is not that the revenue should gain a larger amount of tax by refusing registration to a firm on the ground of technical, immaterial or insignificant defect in the application. (ii) CIT v. J.B. Coal Traders (supra) : In this case, partnership deed was not signed by one of the partners. One partner had also not signed the application for registration. On these facts, it was held that the Tribunal was correct in holding that registration could not be refused on the ground that the application for registration was not signed by a partner and in directing the Income Tax Officer to give an opportunity to the assessee to correct the application. (iii) Ganga Motor Service v. CIT & Ors. (supra) Where the High Court observed that not only courts but quasi-judicial Tribunals also have inherent powers to allow clerical mistakes in application filed before them to be corrected. THE legislature in its wisdom could not have inserted a provision like the one contained in sub-section (2) of section 185 of the new Act, if it-was meant to correct merely clerical mistakes. (iv) CIT v. M.N. Ghosh & Sons (supra) : In this case, application for registration was not signed by all the partners. On these facts, the Hon'ble High Court held that the defect in the application can be rectified and the opportunity was required to be allowed to the assessee to rectify the defect. Since the defect was removed before the completion of assessment, the firm was entitled to registration. Thus, he contended that the assessee was entitled to the benefit of registration.;