Law:

Section:

Section 144, read with section 256 of the Income-tax Act, 1961 - Best assessment - Assessment year 1981-82 - During earlier assessment year ITO taking view that assessee was a chronic defaulter in matter of filing returns, cancelled registration of assessee-firm - For assessment year in question assessee was assessed as unregistered firm - AAC held that there was failure on part of assessee which attracted section 144, and therefore, registration was cancelled for valid reasons - Tribunal also held that there was a failure on part of assessee under section 144 but took a view that cancellation of registration was not justified - Whether a referable question of law did arise out of aforesaid order passed by Tribunal - Held, yes FACTS For the year 1980-81, the ITO after issuing notice to the assessee-firm, cancelled its registration. For the assessment year 1981-82, the respondent was assessed as an unregistered firm. The recalcitrant conduct of the assessee in courting ex-parte assessment was noticed by the Tribunal. It took the view that the assessee was a chronic defaulter in the matter of filing returns. The assessment made on the assessee was affirmed by the AAC. He held that there was failure on the part of the assessee which attracted section 144 and registration was cancelled for valid reasons. In second appeal, the Tribunal held that there was, on the part of the assessee, failure as mentioned in section 144. But it took the view that so far as this case was concerned the circumstances did not justify the cancellation of registration. The reference application filed under section 256(1) was also rejected. Man application under section 256(2): HELD A question of law did arise out of order passed by the Tribunal. Note: The case has been decided in favour of the revenue. CASES REFERRED TO: C.K. Abdul Khader & Co. v. ITO [1983] 141 ITR 159 (Ker.) and Askaran Kissenlal v. CIT [1969] 73 ITR 522 (Cal.). P.K. Ravindranatha Menon and N.R.K. Nair for the Applicant. C.K. Sivasankara Panicker and K.S. Radhakrishnan for the Respondent. JUDGMENT K.S. Paripoornan, J.-The Revenue is the petitioner herein. The respondent is a firm. It is an assessee to income-tax.…

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