Firm registration requires signatures of all partners; appellate authority cannot direct registration after later curing the defect.

Section 26A of the Indian Income-tax Act, 1922, read with rule 2 of the Indian Income-tax Rules, 1922, required a firm's registration application to be in the prescribed form and signed personally by all partners. Where the application before the Appellate Assistant Commissioner lacked the signature of one partner, rule 2(c) empowered only permission for a proper application to be made before assessment was confirmed, reduced, enhanced or annulled. It did not authorise a direction to the Income-tax Officer to register the firm after the missing signature was later obtained. The appellate authority therefore had no competence to issue such a direction.

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Issues: Whether the Appellate Assistant Commissioner was legally competent, on an appeal against refusal to register a firm, to direct the Income-tax Officer to register the firm after obtaining the signature of a partner both in the application for registration and in the deed of partnership.

Analysis: Section 26A of the Indian Income-tax Act, 1922, and rule 2 of the Indian Income-tax Rules, 1922, required an application for registration to be made in the prescribed form and to be signed by all the partners personally. On the facts as stated in the statement of case, no such application signed by all the partners, including the absent partner, was before the Appellate Assistant Commissioner. In that situation, rule 2(c) conferred only the power to permit a proper application to be made before the assessment was confirmed, reduced, enhanced or annulled. It did not authorise a direction to the Income-tax Officer to register the firm after obtaining the missing signature.

Conclusion: The Appellate Assistant Commissioner had no legal competence to issue the direction in the form given, and the answer returned in the negative was correct.

Ratio Decidendi: Where the statute and rules prescribe a signed application by all partners as a condition for registration of a firm, the appellate authority can only grant the permission expressly provided by the rule and cannot enlarge that power into a direction to register the firm on curing the defect later.

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