1990 PLP 1114 (PTD)

K. S. PARIPOORNAN, J.‑‑The Revenue is the petitioner herein. The respondent is a firm. It consists of 10 partners. We are concerned with the assessment year 1979‑

80. The assessee was granted registration for the assessment year 1978‑

79. For the year 1979‑80, admittedly, two partners did not sign in Form No. 12 which is necessary to be filed under section 184(7) of the Income‑tax Act, 1961, read with rules 22(5) and 24 of the Income‑tax Rules, 1962, for continuance of registration. The Income‑tax Officer also held that no authorisation or power of attorney was also filed before him. On these premises, the declaration filed in Form No. 12 was held to be not in order to enable the assessee to continue the benefit of registration under the Act. The firm was assessed in the status of an "unregistered" firm. In appeal, the Commissioner of Income‑tax (Appeals) accepted the plea of the assessee that there was only some defect in the Form filed before the officer (Form No.12) and so the assessee should be given an opportunity to rectify the defect. The Income‑tax Officer was also directed to grant the assessee continuation of registration. In second appeal by the Revenue, the Income‑tax Appellate Tribunal set aside the order and remitted the matter to the Income‑tax Officer directing him to return Form tvo.12 to the assessee and permit the assessee to resubmit the same after rectifying the defect wherein two persons did not sign in the application form. The order of the Appellate Tribunal is dated December 19, 1985. Thereafter, the Revenue filed an application under section 256(1) of the Income‑tax Act to refer the two questions of law formulated in para. 7 of the original petition for the decision of this Court. It was declined by the Appellate Tribunal by order dated September 1, 1986. Thereafter, the Revenue has filed this original petition under section 256(2) of the Act praying that the Appellate Tribunal may be directed to refer the two questions of law formulated in para. 7 of the original petition for the decision of this Court. We heard counsel for the Revenue as also counsel for the respondent assessee at is a moot question as to whether in the absence of the signatures of the two partners in Form No.12 application can be said to be a defect only. Counsel for the Revenue contended that it cannot be called a defect. It is total non‑compliance with the mandatory provisions of law and it was urged that if the assessee should have the benefit or privilege of continuation of registration, the mandate contained in the statutory provisions should be literally complied with. In the absence of strict compliance with statutory requirements, it should be taken that there was no application or form before the Income‑tax Officer to be considered under section 184(7) of the Income‑tax Act. Counsel for the Revenue placed considerable reliance on section 184(7) of the Income‑tax Act,1961, read with rules 24 and 22(5) of the Income‑tax Rules and submitted that the application shall be signed personally and it is mandatory. Counsel for the respondent/assessee submitted that what is involved in this case is only continuance of registration and this is not a case where the genuineness of the firm or the validity of the original partnership deed itself is in question. So, the only question being as to whether the respondent/assessee is entitled to continuance of registration, the Appellate Tribunal was justified in taking the view that non‑signing of Form No.12 by two of the partners is only a defect and an opportunity was validly afforded by the Appellate Tribunal to rectify the defect and represent the application. Reference was also made to the circular of the Central Board of Direct Taxes dated June 26, 1965, which was extracted in the order of the Appellate Tribunal. On hearing the rival contentions of the parties, we are of the view that the questions of law, formulated by the Revenue in para. 7 of the original petition do arise out of the appellate order dated December 19,1985. The questions posed for consideration are not free from difficulty. Therefore, we direct the Income‑tax Appellate Tribunal to refer the following two questions of law formulated in para. 7 of the original petition for the decision of this Court: "(1) Whether, on the facts and in the circumstances of the case, the Tribunal was justified in law in holding that defect should be treated as a technical defect and in directing the Income‑tax Officer to return Form No.12 to the assessee‑firm with a direction to submit the same after rectifying the defect within the time given by the Income‑tax Officer. (2) Whether, on the facts and in the circumstances of the case, the Tribunal was correct in law in directing the Income‑tax Officer to dispose of the question of granting registration to the assessee‑firm after the expiry of the time given by the Income‑tax Officer for rectifying with the defect in Form No.12?" The Appellate Tribunal is directed to refer the above two questions of law along with the statement of the case within two months from the date of receipt of a copy of this judgment. The original petition is allowed. Z.S./738/T Petition allowed.