1985 (11) TMI 48 - HC - Income Tax

Summary

Issues:
1. Competency of appeal against the order refusing to condone the delay in filing the application for registration.
2. Competency of appeal disputing the status adopted as an unregistered firm for the assessment year.

Analysis:
1. The judgment addressed the issue of the competency of an appeal against the order refusing to condone the delay in filing the application for registration. The assessee-firm applied for registration under section 184 of the Income-tax Act, 1961, which was filed 37 days out of time. The Income-tax Officer rejected the application for condonation of delay. The Appellate Assistant Commissioner rejected the appeal against this order, stating it was not appealable. However, the appeal against the assessment order was allowed, setting aside the assessment and remanding the case for proper consideration of the registration application. The Tribunal allowed the Department's appeal but did not address the merits of the assessee's appeal.

2. The judgment also discussed the competency of an appeal disputing the status adopted as an unregistered firm for the assessment year. The Appellate Assistant Commissioner has the power to confirm, reduce, enhance, or annul the assessment under section 251. The assessee challenged the assessment order, claiming it should have been assessed as a registered firm, not an unregistered one. The Appellate Assistant Commissioner was justified in setting aside the assessment, condoning the delay, and directing reconsideration based on the merits of the registration application. The Tribunal erred in holding the appeal against the assessment order as incompetent, as confirmed in the case law ITO v. Vinod Krishna Som Prakash [1979] 117 ITR 594 (All).

In conclusion, the judgment answered the second issue in favor of the assessee, stating the appeal against the assessment order disputing the status as an unregistered firm was competent. The judgment did not find it necessary to address the first issue. The parties were directed to bear their respective costs, and a copy of the judgment was to be forwarded to the Income-tax Appellate Tribunal, Cochin Bench.