Ajit K.Sengupta, J. - (1.) In this reference under Section 256(2) of the Income-tax Act, 1961, for the assessment years 1966-67, 1972-73 to 1974-75, the following common question of law has been referred to this court : "Whether, on the facts and in the circumstances of the case, the Tribunal was justified in its finding that the income from letting out of the entire commercial assets to Messrs Salkia Jute Pressing Co. (P.) Ltd. was business income and, in that view, upholding the Appellate Assistant Commissioner's order to allow registration to the assessee for the assessment years 1966-67, 1972-73, 1973-74 and 1974-75 ?"
(2.) The assessee-firm was enjoying the benefit of registration from its inception. The firm also took over the running business of a jute press at Salkia and was utilising the same for the purpose of its business. Thereafter, in view of the closure of the jute processing centres in Bangladesh and also because of some internal trouble, the assessee leased out its commercial assets to one Salkia Jute Pressing Co. (P.) Ltd. with the agreement of taking back the same at short notice. This fact led the Income-tax Officer to believe that the assessee had not carried on any business and, therefore, it was not entitled to registration in view of the decision of the Calcutta High Court in the case of Sunil Krishna Paul [1966] 59 ITR 457. He, therefore, refused to register the assessee-firm for the years under reference.
(3.) The assessee preferred appeals to the Appellate Assistant Commissioner. The Appellate Assistant Commissioner, after considering the facts and circumstances of the case, directed the Income-tax Officer to grant registration.;