9911796707
|
Home
Issues:
Challenge to refusal of renewal of registration to assessee-firm for assessment year 1982-83. Analysis: The appeal pertains to the refusal of renewal of registration to the assessee-firm for the assessment year 1982-83. The delay in filing the appeal by three days was condoned after considering the explanation provided by the assessee. The Assessing Officer disallowed the continuation of registration for the intervening year based on the absence of profit division among partners and unauthorized withdrawals by one partner. The CIT(A) upheld this decision, citing a Supreme Court precedent. The assessee argued that profit division was not a legal prerequisite for registration continuation, pointing out differences in the language of relevant forms. The firm had divided profits as per the income statement submitted. The Department contended that profit distribution was essential for registration. Upon review, the Tribunal found merit in the assessee's argument. The income statement showed equal profit division among partners, satisfying the rules. The Tribunal disagreed with the Department's view that excessive withdrawals equated to profit withdrawal beyond the partnership deed ratio. Improper account maintenance did not justify registration disallowance. Considering the overall circumstances and consistent registration in prior and subsequent years, the Tribunal ruled in favor of the assessee, allowing the appeal.
|
