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Issues:
1. Whether the question of status of a firm can be considered by the Appellate Assistant Commissioner during an appeal against the assessment quantum? Analysis: The judgment pertains to references under section 256(1) of the Income-tax Act for the assessment years 1972-73 and 1973-74. The main question raised was whether the Appellate Assistant Commissioner had the authority to entertain an appeal against the Income-tax Officer's decision to refuse continuation of registration under section 184(7) of the Income-tax Act, thereby classifying the assessee as an unregistered firm for the mentioned assessment years. Two Division Benches of the court had previously addressed similar issues in the cases of Madhur Jalpan and CIT v. Manuram Babulal. In the Madhur Jalpan case, it was established that when a composite order was issued rejecting the status of the assessee as a registered firm and assessing it as an unregistered firm, the assessee had the right to challenge both grounds in an appeal under section 246(c). The CIT v. Manuram Babulal case further clarified that the term "status" in section 246(c) encompassed all categories of firms, registered or unregistered, effective from April 1, 1971. It was also decided that an appeal against the determination of the continuation of a registered firm's status was permissible. Based on the precedents set by the aforementioned cases, the court concluded that the Appellate Assistant Commissioner indeed had the jurisdiction to hear the appeal against the Income-tax Officer's decision regarding the continuation of registration under section 184(7) for the assessment years in question. Consequently, the court answered the referred question in the affirmative, favoring the assessee and ruling against the Revenue. The judgment also directed the Revenue to pay the assessee a hearing fee and instructed the transmission of the judgment to the Income-tax Appellate Tribunal as per the provisions of the Income-tax Act, 1961.
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