Law: Income Tax Act, 1922

Section: 26A

Income-tax-Firm-Registration of -Renewal - Refusal to renew-Whether novice to show cause necessary-Indian income tax Act, 1922, S. 26.A. The order of the Income-tax Officer refusing renewal of registration of the assessee-firm under section 26-A of the Indian Income-tax Act .on account of default of compliance by tile assessee with the notice under section 23(4) for production of accounts is not illegal or invalid for want of a notice to show cause. Section 23(4) does not require either explicitly or implicitly that a notice should be given. Chockalingam (M.) and another v. Commissioner of of Income-tax (1963) 48 I T R 34 (S C) ; Dwarka Nath v, Income-tax Officer, Special Circle, D-Ward, Kanpur (1955) 51 I T R 349 (S C) ; Mahabir Glass Manufacturing Co. v. Commis sioner of Income-tax (1960) 39 I T R 421 and Sahdeo Vijay Kumar v. Commissioner of Income-tax (1961) 42 I T R 182. JUDGMENT A. N. RAY, J.---------The question referred to this Court is as follows: "Whether, on the facts and in the circumstances of the case, the order refusing renewal of registration under section 26-A is legal and valid?" The case relates to the assessment year 1947-48. The assessee applied for renewal of registration under section 26-A of the Indian Income-tax Act, 1922. In default of compliance with the notice for production of books of accounts for the relevant assessment year, the assessee was assessed under section 23(4) for the year in question. The Income-tax Officer thereafter refused to renew registration to the assessee, under section 26-A of the Income-tax Act, saying that the account books for the year in question not having been produced, it was not possible for him to verify whether the profits had been distributed in accordance with the terms of the partnership deed. The order of the Income-tax Officer was passed under section 23(4)/26-A of the Indian Income-tax Act, 1922. An appeal was preferred against the Income-tax Officer's order to the Appellate Assistant Commissioner. It was urged before him that the renewal of registration having been refused on the ground that the assessment had been made under section 23(4) of the Act, it was incumbent on the…