Sabyasachi Mukharji, J. - (1.) This is an appeal from the decision and judgment of the High Court of Patna dated 23rd November, 1973. The appeal is by certificate from the High Court under section 261 of the Income Tax Act, 1961, hereinafter called the 'Act'. The assessee firm was registered in 1945 under the Indian Income Tax Act, 1922. The registration was upto the assessment year 1961-62. There was a change in the constitution of the firm on the last day of the previous year relevant to the assessment year 1962-63 on 8th November, 1961. From November 9, 1961, a new instrument of partnership came into existence. On September 29, 1962 the firm applied for registration under the Act in Form 11A. The Income-tax Officer refused registration on the ground. that the case fell under section 184(7) of the Act. The Tribunal, thereafter upheld the order of the Income-tax Officer. There. was a reference to the High Court. It was held by the High Court that the application was filed in September, 1962. On that date the constitution of the firm had changed. The application for registration under the 1961 Act was for registration of the firm which was in existence throughout the length of the previous year in relation to the first assessment year under the Act of 1961. That being so, in accordance with rule 22(4)(ii), Income-tax Rules, the application filed in Form 11 A was a good and valid application.
(2.) The High Court, further, observed that the scheme of renewal of registration under the Act of 1961 was different from the one that obtained under 1922 Act. Under the Act of 1922, application for renewal of registration meant application for registration every year and had the effect of registering the firm every year. Under the Act of 1961 when once registration was granted under the Act of 1922 to any firm for any assessment year it enured for subsequent years also unless there was a change in the constitution of the firm. A registration granted under the Act of 1922 would not have the effect of continuing the registration for the assessment year 1962-63 to which the Act of 1961 became applicable. For that year an application for registration had to be made for the purposes of the Act of 1961 in accordance with section 184(1) and the fact that the registration under the Act had got to be noted under sub-section (4) of section 185 of the Act. A renewal of registration granted under the Act of 1922 is not a "recognition granted" or "order issued" within the meaning of section 297(2)(k) of the 1961 Act and was, therefore, saved by the provisions of that section.
(3.) The question that was referred by the Tribunal to the High Court under section 256(1) of the Act was as follows:- "Was the application for registration-made In form No. 11A on 29th. September, 1962 validly refused -;