1977 (6) TMI 44

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....d the benefit of registration was referred to it under s. 185(5) of the IT Act, 1961. This order was, however, set aside by the Tribunal in second appeal. 3. For the assessment year under consideration, the assessee firm filed an application in Form No. 12 for continuation of registration under s. 187(7) of the IT Act, 1961. The ITO held as follows: (i) That since the assessee firm was treated as unregistered firm in the immediately preceding year i.e., the asst. yr. 1971-72, it should have filed an application in Form No. 11 for grant of registration for the asst. yr. 1972-73. (ii) That since the assessment for the assessment year under consideration was completed under s. 144 for non-compliance with the notice under s. 142(1), th....

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....ich circumstance let the ITO to frame the assessment exparte under s. 144. The reasons stated by the ITO in support of his finding need not be repeated here. Since it stands proved that there was on the part of the appellant firm, a failure as mentioned in s. 144 namely, the non-compliance with the terms of a notice issued by the ITO under sub-s. (1) of s. 142, the ITO, was fully justified in refusing to register the firm on the basis of the declaration filed by the latter in form No. 12. The refusal of registration by the ITO to the appellant firm is, therefore, in accordance with the provisions of s. 185(5) of the IT Act, and I, therefore, decline to interfere". 5. Aggrieved by the order of the AAC, the assessee has filed the present a....

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....tions laid down under the proviso to s. 184(7) were not satisfied. It is not disputed that there was no change in the constitution of the firm or the shares of the partners etc. during the year and that the assessee filed the declaration in Form 12 within the time allowed by law. In these circumstances, the assessee was entitled to continuation of registration under s. 184(7) of the IT Act, 1961. 8. The second question for consideration is whether the ITO could refuse registration to the assessee firm under s. 185(5). This section reads as follows: "Notwithstanding anything contained in this section where, in respect of any assessment year there is, on the part of a firm, any such failure as is mentioned in s. 144, the ITO may refuse ....