1986 (11) TMI 106 - AT - Income Tax

Summary

Issues:
1. Whether the firm should be treated as an unregistered firm for the assessment year 1980-81 due to non-filing of Form No. 12 for continuation of registration.
2. Whether the assessment order of the firm should be annulled.
3. Whether the status of the firm as an unregistered firm is legal and valid.

Analysis:

Issue 1:
The Income Tax Officer (ITO) treated the assessee as an unregistered firm for the year 1980-81 as Form No. 12 for continuation of registration was not filed. The Appellate Assistant Commissioner (AAC) upheld this decision, stating that without the filing of Form No. 12, continuation of registration could not be allowed. The argument that some partners had been assessed for tax purposes, which should grant the status of a registered firm, was rejected. The AAC emphasized that partners' share had been taken on a protective basis and could be rectified later. The Income Tax Appellate Tribunal (ITAT) noted the conflicting views of different High Courts on this issue but relied on the decision of the Delhi High Court in Punjab Cloth Stores vs. CIT, which held that under the new Income Tax Act, the firm had to be treated as unregistered if Form No. 12 was not filed.

Issue 2:
The assessee contended that the assessment order of the firm should be annulled, arguing that some partners had been assessed prior to the firm's assessment, and double assessment on the same income should not be allowed. However, the ITAT did not find merit in this argument and upheld the assessment order of the firm as an unregistered firm for the year in question.

Issue 3:
During the proceedings, it was mentioned that the assessee had lost the receipt for filing Form No. 12. The ITAT reviewed the records and found discrepancies regarding the filing of the form. A letter indicated the intention to file Form No. 12, but its actual filing date was unclear. The ITAT declined to consider this declaration due to the lack of evidence of filing before the assessment was made. The issue regarding the lost receipt was not raised before the AAC. Consequently, the ITAT dismissed the appeal, affirming the status of the firm as an unregistered firm for the assessment year 1980-81.