Continuance of firm registration under section 184(7) depends on unchanged constitution, partner shares, and timely declaration.

Continuance of registration for a registered firm under section 184(7) depends on the substantive conditions remaining unchanged, namely no change in the firm's constitution or in the partners' shares as set out in the partnership instrument. The prescribed declaration filed along with the return was treated as directory, so the benefit was not denied where the return and declaration were before the assessing authority at the time of assessment. The earlier refusal of registration for the immediately preceding year could not, by itself, defeat continuance of registration where the statutory conditions were otherwise satisfied.

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Issues: Whether the assessee-firm was entitled to continuance of registration under section 184(7) of the Income-tax Act, 1961 for the assessment year in question despite the refusal made on the footing that registration had not been allowed in the immediately preceding year.

Analysis: Registration once granted continues for subsequent years if there is no change in the constitution of the firm or in the shares of the partners as evidenced by the partnership instrument and the prescribed declaration accompanies the return. The requirement that the declaration be filed along with the return is directory and not mandatory where the return and declaration are before the assessing authority when the assessment is made. On the admitted facts, there was no change in constitution or in the allocation of shares, and the earlier denial of registration for the preceding year could not by itself defeat the statutory benefit of continuance of registration.

Conclusion: The assessee-firm was entitled to renewal or continuance of registration under section 184(7), and the refusal to recognise such renewal was unsustainable.

Final Conclusion: The assessment order refusing recognition of the firm's renewed registration was quashed, and the consequential proceedings based on that refusal also fell.

Ratio Decidendi: Where a registered firm satisfies the substantive conditions for continuance of registration and the statutory declaration is before the assessing authority at the time of assessment, the benefit of section 184(7) cannot be denied merely because registration was not granted in the immediately preceding year.

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