9911796707
TMI Blog1980 (8) TMI 71X X X X Extracts X X X X X X X X Extracts X X X X ..... e provisions of the Income-tax Act for the A. Y. 1969-70 ? " The material facts giving rise to this reference, as set out in the statement of the case, briefly are as follows : The Gwalior Maize Products Ltd. carried on business at Mandsaur of manufacturing starch from maize. The company granted a lease of its factory to one Rajaram Gupta. Before the expiry of this lease, the company faced financial difficulties and the debenture-holders of the company took possession of the property of the company. They instituted a suit against Rajaram Gupta for eviction. A compromise was arrived at in that suit, and in terms of the compromise a decree was passed by the court. Under this decree, Rajaram Gupta was allowed to remain in possession of the fa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... opinion. According to the Tribunal, the assessee was not entitled to registration because the assessee did not carry on any business activity in the relevant previous year. The Tribunal has, however, observed that there was no dispute that all other normal incidents for constituting a valid partnership agreement existed in the case of the assessee. The short question for consideration, therefore, is whether failure to carry on any business in the relevant previous year can be a ground for refusing registration under the Act when the Tribunal has found that a valid partnership agreement was in existence. Now, the relevant provisions of s. 185(1) of the Act are as follows : " 185. Procedure on receipt of application.-(1) On receipt of an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... held to be relevant for refusing registration. Learned counsel for the department urged that we should direct the Tribunal to send a supplementary statement of case giving its finding on the question as to whether the assessee intended to carry on any business. The contention cannot be upheld. The Tribunal has given a specific finding that but for the fact that no business was carried on in the relevant previous year, all other incidents for constituting a valid partnership agreement were in existence. Thus, the only reason, according to the Tribunal, for refusing registration was that the assessee did not carry on any business in the previous year and this reason cannot, in our opinion, constitute a valid reason for refusing registration. ..... X X X X Extracts X X X X X X X X Extracts X X X X
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