COMMISSIONER OF INCOME TAX Vs. M N GHOSH AND SONS

JUDGEMENT

(1.) THIS is a reference under S. 256(1) of the INCOME TAX ACT, 1961 (hereinafter called " the Act "). In this case, we are concerned with the asst. year 1973 -74. The questions referred to us for our opinion are the following:

(2.) THE assessee is a partnership firm. In the year in question it applied for registration in terms of s. 184(7) of the Act. The application was, however, signed by only one of the partners. By order dt. December 30, 1974, the assessee was asked to show cause why its application for registration under S. 184(7) of the Act be not refused, as the applica tion was not signed by all the partners. The very following day, i.e., on December, 31, 1974, the assessee filed fresh Form No. 12 with the signatures of all the partners. The original application having been filed only under the signature of one of the partners, the ITO held that the assessee was not entitled to the benefit of registration. The assessee had contended that at the time the application for registration was filed all the partners were not available and, therefore, they could not put their signatures on the application. This explanation did not find favour with the ITO with the result that registration was refused. The assessee being aggrieved by the order of the ITO appealed to the AAC. The AAC accepted the explanation of the assessee that all the partners were not available at the time the application for registration was filed. The appeal of the assessee thus was allowed by the AAC.

(3.) IN regard to the validity of the appeal which has been raised in the first question, for our opinion, it must be observed that the question is con cluded by the decision of this Court in CIT vs. Gyanchand Bedi (1986) 54 CTR (Pat) 333:(1987) 163 ITR 693 (Pat), This Court, following the decision of this Court in Madhur Jalpan vs. CIT (1983) 143 ITR 351 (Pat), held that where the appeal is against the order of assessment as well as against the rejection of the status of the assessee, appeal against the rejection of the stand in regard to status would be maintainable. The question whether the assessee was a registered firm or an unregistered firm is a question affecting the status of the assessee. The consistent view of this Court, therefore, has been that an order rejecting a prayer for registration along with an order of assessment is appealable. In that view of the matter, it must be held that the answer to the first question must be in the affirmative, in favour of the assessee and against the Revenue. The Tribunal was absolutely correct in holding that the question of registration under S. 184(7) was appealable before the AAC.