1978 (8) TMI 60 - HC - Income Tax

Summary

Issues involved:
The issues involved in the judgment are related to the condonation of delay in filing a declaration for renewal of registration by a firm under the Income Tax Act, 1961. The primary issue is whether an appeal lies against the Income Tax Officer's order refusing to condone the delay in filing the application for registration.

Judgment Details:

1. Delay Condonation Issue:
The assessee, a firm engaged in the business of brick-kiln, filed a declaration for renewal of registration for the assessment year 1971-72 after a delay of one month and six days. The Income Tax Officer (ITO) refused to condone the delay, treating the firm as unregistered. On appeal, it was held that the delay should have been condoned, and the firm's status was considered as that of a registered firm.

2. Appealability of ITO's Order:
The Tribunal considered whether an appeal lies against the ITO's order refusing to condone the delay. The revenue contended that such an order falls under section 184(7) of the Act, against which no appeal provision is provided under section 246. The Tribunal, relying on the Gujarat High Court decision and Supreme Court precedents, held that an appeal lies under section 246(j) of the Act. The Tribunal dismissed the revenue's appeal.

3. Legal Interpretation of 'Status' for Appeal:
The High Court analyzed the appealability of the ITO's order under section 246(c) of the Act, which allows appeals against orders related to the assessee's liability or status under the Act. The court emphasized that 'status' refers to the category under which the assessee is assessed, including a firm as a 'person' under section 2(31) of the Act. The court clarified that the classification of a firm as registered or unregistered falls under 'status' as per Explanation 2 of section 143, making it appealable under section 246(c).

4. Conclusion:
The High Court upheld the Tribunal's decision, stating that the order refusing to condone the delay in filing the declaration was appealable under section 246(c) as it related to the firm's status for assessment. The court ruled in favor of the assessee, allowing the appeal and awarding costs amounting to Rs. 200.

This judgment clarifies the legal interpretation of 'status' under the Income Tax Act, emphasizing the appealability of orders related to the classification of a firm as registered or unregistered.