ADDITIONAL COMMISSIONER OF INCOME TAX Vs. BHATIA MAHAJAN CONSTRUCTION
HIGH COURT OF RAJASTHAN (FROM: JAIPUR)
ADDL. COMMISSIONER OF INCOME-TAX
BHATIA MAHAJAN CONSTRUCTION
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Agrawal, J. -
(1.)IN this reference made under Section 256(1) of the INcome-tax Act, 1961, the INcome-tax Appellate Tribunal (hereinafter referred to as " the Tribunal"), has referred the following question to this court:
" Whether, on the facts and in the circumstances of the case, the Tribunal was right in condoning the delay in filing a declaration under Section 184(7) of the INcome-tax Act, 1961 ? "
(2.)M/s, Bhatia Mahajan Construction Co., Bundi (hereinafter referred to as " the assessee "), was a registered firm for the assessment year 1965-66. The return for the assessment year 1966-67 was filed by the assessee on September 29, 1966. Revised returns were filed by the assessee on August 25, 1967, and September 21, 1967. The application for continuation of registration in Form No. 12 was filed on June 28, 1968. The ITO did not continue the registration of the assessee for the reason that the assessee had failed to claim continuation of registration by filing an application under Section 184(7) of the I.T. Act in the prescribed form and he made an assessment treating the assessee as an unregistered firm. The order of the ITO treating the assessee as an unregistered firm was upheld on appeal by the AAC. Before the Tribunal it was pointed out by the assessee that the return of income was filed by Janak Raj, one of the partners of the assessee, who died immediately thereafter on October 13, 1966, and that the other partners of the assessee were under the impression that the application for continuation of the registration has already been filed by Shri Janak Raj along with the return on September 29, 1966 and that it was only when the ITO pointed out that the said application was not received that the other partners searched for the application and came across the same and filed it before the ITO. Taking into consideration the circumstances referred to above, the Tribunal held that the failure to file the application for continuation of registration was due to the peculiar circumstances urged by the assessee. The Tribunal further held that the genuineness of the firm itself is not in question. The confusion has arisen as a result of the death of the partner, Janak Raj, in October, 1966. Taking into consideration the aforesaid circumstances, the Tribunal was of the view that the firm should be granted continuation of registration for the assessment year 1966-67. Thereafter the Additional Commissioner of Income-tax moved an application before the Tribunal for referring the question mentioned above to this court and, therefore, the Tribunal has made this reference.
We have heard Shri R. N. Suroliya, the learned counsel for the Revenue, and have perused the statement of case and the orders passed by the ITO, the AAC and the Tribunal.
The statement of the case shows that the application for continuation of registration that was filed on June 28, 1968, bears the signature of the partners including the deceased partner, Shri Janak Raj, indicating that the said application was signed by the partners before the death of Shri Janak Raj on October 13, 1966, and due to oversight the said application could not be filed along with the return on September 29, 1966. In the circumstances, the Tribunal was justified in holding that the failure on the part of the assessee to Ale the declaration prior to June 28, 1968, was under the bona fide belief of the partners of the assessee that the application had already been filed by Janak Raj.
In the facts and circumstances of the case, the Tribunal cannot be said to have committed any error in condoning the delay in filing a declaration under Section 184(7) of the I.T. Act, 1961, for the assessment year 1966-67.
The reference is, therefore, answered in the affirmative.
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