1983 (1) TMI 98 - AT - Income Tax

Summary

Issues:
- Contention regarding the direction to allow registration to the assessee firm.

Analysis:
1. The appeal revolved around the CIT(A) directing the ITO to grant registration to the assessee firm. The original firm consisted of two partners and five minors, later undergoing a change in constitution with the minors exiting and two new individuals representing trusts joining the firm.

2. The ITO rejected the registration claim, treating the assessee as an Association of Persons (AOP) of the original partners only, citing a similar case where registration was denied to another firm. The CIT(A) overturned this decision after detailed discussion and reliance on legal authorities, directing the ITO to grant registration to the assessee.

3. The appellate tribunal considered the application of the Explanation to section 185(1) of the Act, determining that it did not apply to the case as the necessary information was communicated to the ITO. Additionally, the tribunal referenced the decision in CIT v. Bagyalaxmi & Co. (1965) 55 ITR 660 (SC) to support the assessee's case for registration.

4. The tribunal further differentiated the present case from the case of Kedia Yarn Traders, highlighting that the assessee firm was constituted after the execution of trust deeds, unlike Kedia Yarn Traders. This distinction led to the tribunal agreeing with the CIT(A) that the assessee was entitled to registration.

5. Ultimately, the tribunal dismissed the appeal, upholding the CIT(A)'s decision to grant registration to the assessee firm based on the specific circumstances and legal precedents cited during the proceedings.