Law: Income Tax Act, 1922

Section: 22(2),23(4),66(1),26A,31,30

Income-tax Act, 1922 -Sections 22(2), 26A -- Registeration -Renewal of registration -Failure to comply with notice under Section 22(2) -Assessment made ex-parte and renewal of registration refused -Notice of the intention to refuse renewal of registration, whether necessary -Held no -- JUDGMENT The judgment of the court was delivered by HASAN J.-A notice under Section 22(2) of the Income-tax Act, hereinafter called the Act, was served on the assessee on the 19th July 1958 to submit return for the assessment year 1958-59. The Assessee did not submit any return as required under Section 22(2) of the Act whereupon the Income-tax Officer assessed the assessee under Section 23(4) of the Act. He also rejected the application for registration or renewal of the registration for the assessment year 1958-59. Thereafter the assessee was served with the aforesaid order. The assessee filed appeal against that order before the Appellate Assistant Commissioner. The Appellate Assistant Commissioner dismissed the appeal whereupon the assessee filed an appeal before the Income-tax Appellate Tribunal. The Appellate Tribunal set aside the order of the Income-tax Officer refusing registration of the firm for the assessment year 1958-59 on the ground that before passing the aforesaid order no notice was issued on the assessee calling upon the firm to show cause why registration on should not be refused. Thereupon the Income-tax authority filed an application under Section 66(1) of the Act for reference to the High Court. The Tribunal formulated the following point and referred the same to the High Court for its decision. "Whether on the facts and in the circumstances of the case it was incumbent on the Income-tax Officer to give notice to the firm of his intention to refuse the claim for renewal of registration in accordance with the proviso to Section 23(4) of the Income-tax Act?" On behalf of the Income-tax authority it has been submitted by the learned Advocate for the applicant that no notice in such a case has been provided for by any provision in the Act or the rules made thereunder and that the only provision for notice that has been made in Sections 23 and 26A of the Act is…

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