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Issues:
- Registration of the assessee-firm working under the name and style of M/s Space-onix for the assessment years 1980-81 and 1981-82. Analysis: 1. Issue of Registration for Assessment Year 1980-81: - The firm, M/s Space-onix, had a change in partnership in 1979, with Smt. Meena Kanika being admitted as a partner. The Income Tax Officer (ITO) rejected the registration for this year, alleging that Smt. Meena Kanika was a benamidar of her husband. The Commissioner of Income Tax (Appeals) (CIT(A)) overturned this decision, stating that the rejection was on invalid grounds as Smt. Meena Kanika provided a reasonable explanation for her investment in the firm. 2. Issue of Registration for Assessment Year 1981-82: - The ITO again rejected the registration for this year, continuing the reasoning from the previous assessment year. The CIT(A) upheld the registration, emphasizing that the ITO failed to prove that Smt. Meena Kanika was a benami of her husband. The CIT(A) directed the ITO to continue the registration under the Income Tax Act. 3. Appellate Tribunal Decision: - The Appellate Tribunal upheld the decisions of the CIT(A) for both assessment years. The Tribunal found no justification to interfere with the orders, noting that Smt. Meena Kanika was a genuine partner in the firm. The Tribunal highlighted that the ITO's doubts regarding her capital contribution were unfounded, as she provided a basis for the amount contributed. Additionally, the Tribunal stated that the mere fact that her husband was a previous partner did not establish her as a benamidar. The Tribunal concluded that Smt. Meena Kanika was not a benamidar and was entitled to operate the firm's bank account independently. Therefore, the appeals of the Revenue were rejected. This comprehensive analysis of the judgment highlights the key issues of registration of the firm for the relevant assessment years and the reasoning behind the decisions made by the authorities and the Appellate Tribunal.
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