TMI Blog1993 (12) TMI 44X X X X Extracts X X X X X X X X Extracts X X X X ..... bsequent years also as contemplated under section 184(7) of the Act. It appears that a fresh deed of partnership dated July 1, 1990 (annexure "4" to the writ petition), was executed. The preamble to that deed, inter alia, recites that the petitioner, Madan Mohan Paul, by his written notice dated May 25, 1990, to the remaining partners expressed his desire to retire from the partnership after the expiry of the notice period of one month as required under clause 14 of the partnership deed dated October 1, 1980, and on the expiry of the notice period he submitted his retirement consent on June 25, 1990, confirming his retirement with effect from the close of June 30, 1990, and from that date, he actually retired. It is further recited that the remaining partners of the said firm have accepted the retirement of the petitioner with effect from the close of June 30, 1990, and they have reconstituted the firm from July 1, 1990, along with respondent No. 6 who was not a partner in the earlier partnership deed dated October 1, 1980. We may notice that respondent No. 4 is the brother-in-law of the petitioner being married to his sister and respondents Nos. 4, 5 and 6 are brothers. The case ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ists and the registration granted by the Registrar of Firms on the basis of the said partnership deed is also subsisting. He argued that the reconstituted firm or partners named thereunder be refrained from filing any income-tax return in respect of the business carried on by the firm in question and any return if already submitted by them is non est in law which cannot be acted upon and is liable to be rejected. Learned counsel further contended that the application seeking fresh registration by the alleged reconstituted firm under the Act is also not liable to be entertained nor any registration can in law be granted to the firm under section 185 of the Act in the circumstances of the case. Another argument is that the application for registration filed by the contesting respondents cannot be decided ex parte to the exclusion of the petitioner and, in any case, no decision on such application should be taken until the representations filed by the petitioner are decided by the concerned respondents for which necessary directions may be issued by this court. We have considered these submissions carefully. Undisputedly, a firm is an assessee under section 2(7) of the Act, whether ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uisition and impound the account books and relevant records, sales and purchase bills, stock registers and the orders received from the various Government Departments by the reconstituted firm and to make them available to the petitioner for his examination in order to detect discrepancy, etc. Again the contention whether the petitioner continues to be a partner or not, is a matter which perhaps can be adjudicated upon by a competent civil court. Undisputedly, the petitioner has already instituted a civil suit being Suit No. 94 of 1993 in the Court of the Civil Judge, Gonda, seeking dissolution of the firm and for accounting, etc. Likewise, the representations also contain allegations which are more in the nature of complaints than anything else. They are with respect to evasion of tax by the reconstituted firm and its partners. Learned counsel for the petitioner was unable to refer to us any provision in the Act under which the representations/applications of the nature referred to above were maintainable and for which he could demand a decision as a matter of right, or there was a corresponding duty of the concerned respondents to decide the same. In the name of representations, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of each partner in the income of the firm is included in his total income and assessed accordingly along with other income, if any. In the case of an unregistered firm, the firm itself is assessed to tax unless it is covered by section 183(b) of the Act. The procedure for computation of total income of a firm is common, whether it is registered or unregistered. A firm can trade without being registered under the Act. The importance of registration of a partnership firm under the Act lies in the fact that after registration the firm becomes liable to assessment to income-tax at lower rates than what otherwise would be in the case of an unregistered firm. The right of registration to a firm is given by the Act in order to enable it to get the benefit of lower rates of tax than those which would be applicable to the whole income of the firm charged as unit of assessment. In N. T. Patel and Co. v. CIT [1961] 42 ITR 224 (SC), the Supreme Court observed that the reason impelling a firm to secure registration is that if registration is granted, the firm can pay the concessional rate of tax. The right to obtain registration is a statutory right which can be availed of when the requirements ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... at be so, this itself meets the complaint of the petitioner when he asserts that he is entitled to have his say in the matter. In these circumstances, for the present, it is unnecessary to pursue the discussion further. Suffice it to say that the matter is in the discretion of the Assessing Officer which must be exercised on judicial considerations bearing in mind that it will facilitate the enquiry under section 185 in order to reach the necessary satisfaction whether the firm is entitled to registration or not. For the reasons stated above, the petitioner is not entitled to any relief in respect of the last contention as well. Before parting with the case, in all fairness, we may mention the argument advanced by learned counsel who appeared for respondents Nos. 4 to 7. We were invited to the provisions of section 185(6) which refers to deemed "registration" to a firm in certain circumstances, envisaged under that sub-section. The said provisions contemplate that notwithstanding anything contained in sub-sections (1) to (4) where a firm has made an application for registration in relation to an assessment year and has furnished the return for that assessment year, such firm sh ..... X X X X Extracts X X X X X X X X Extracts X X X X
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